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Thursday, December 1, 2005
Gas-o-nomics
By Dr. Steven Taylor @ 3:17 pm

I have seen gas as low as $1.94/9 in the Montgomery area (as of today). Oddly, gas in Troy (about 38 miles south of Montgomery) is almost .16 more than in Montgomery (when comparing lowest price to lowest price). That is odd because in the seven and half years I have lived in the area, I have almost always been able to get the lowest price in Troy by a few cents.

On Wednesday the lowest price in Troy was $2.12 (and most stations were at $2.14 +). Half-way between Troy and Montgomery in Pine Level, AL the lowest price was $2.02, while in Montgomery one could have gotten it for $1.96 (at least based on what I saw yesterday).

And Riddle Me This, Batman: if Station A has gas at $1.96/9 a gallon and right across the street Station B has gas at $2.02/9 a gallon, who in their right mind gets gas at station B? Yes, station A is a regional chain and Station B is a national chain, but still: I don’t get it.

Filed under: General, US Politics, The Economy | |Send TrackBack

10 Comments »

  1. Some people (my wife included) don’t look at prices-they look for brands or the shortest line. Others genuinely believe that there is a difference between “name brand” and “off brand” gasolines.

    Comment by James Joyner — Thursday, December 1, 2005 @ 3:24 pm

  2. That and the times when traffic makes crossing the street not worth it, so if you need gas then, you buy it at the station on your side of the road.

    Comment by Zeuswood — Thursday, December 1, 2005 @ 3:41 pm

  3. How about this one . . . Stations A and B are the same - both in gas brand and in associated convience store. However, Station B, which is newer, has gas a few cents lower. Station B is down the street from A - out of sight, but hardly out of mind. In fact, both serve a major mall. Who is going to get gas from station A?

    I think Station A recognized this, as they have now synced up their prices. Right after B was built, however, it was always cheaper.

    Comment by B. Minich, PI — Thursday, December 1, 2005 @ 3:45 pm

  4. (They ARE on opposite sides of the road, but the road isn’t usually that crowded, save on major shopping days.)

    Comment by B. Minich, PI — Thursday, December 1, 2005 @ 3:45 pm

  5. In the case of my scenario, access is irrelevant-both are essentially equally easy to get to and there is nothing about traffic flow that would favor one over the other.

    And lines are rarely an issue.

    Comment by Dr. Steven Taylor — Thursday, December 1, 2005 @ 4:40 pm

  6. if their work-issued gas card is from Station A.

    Comment by caltechgirl — Thursday, December 1, 2005 @ 5:24 pm

  7. COFFEE! Sure the gas is a few cents higher, but the coffee is fresh brewed, compared to a dirty pot with sludge at the bottom at the other station!

    Comment by Lew Clark — Thursday, December 1, 2005 @ 5:30 pm

  8. Alabama’s Motor Fuel Marketing Act prohibits retailers from selling gas below cost. So, if Station B has purchased their supply when the wholesale price was higher than when Station A purchased it, then it would be illegal for station B to lower its price to compete with station A until they need to purchase gas from their supplier again.

    Or, at least that is how I understand the law.

    Comment by Mark — Thursday, December 1, 2005 @ 5:41 pm

  9. I’m too busy stuck in your Soduko based death trap to respond at the moment Riddler, but as soon as I can contact Oracle and have her access the chemical breakdowns of the various gasolines and divide that by brand loyalty modified by lazyness I will at last have defeated you. Then I can move on to Calendar Man!

    Comment by Christian Johnson — Thursday, December 1, 2005 @ 5:54 pm

  10. I used to work at a major chain’s convenience store. Our station manager had to fill out a report at least a couple of times a week which required her to drive around to the gas stations within a few blocks and record all their prices. She would then market her gas 1 cent lower than the lowest price. This was a company sheet, so I’m assuming the entire company did this.

    So, that would at least explain why the gas would be the same in one area but not another area of the city. But it doesn’t explain the five cent difference between stations across the street from one another.

    Comment by bryan — Thursday, December 1, 2005 @ 5:58 pm

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