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GasBuddy News Article

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Why gas prices vary from station to station

Marketplace -- Don't look now, but gas prices are on the rise again -- 45 cents in the past month, 33 straight days of increases, according to AAA.

Sure, oil prices are going up too, but how does it work down at the retail level? Why is one station $4-a-gallon and the one down the road $4.05? We called a guy we know who runs a gas station. Oz Elam has a place on Boston Post Road in Pelham, N.Y.

Right now, gas at Elam's station is going for $3.99. Elam said he came up with the number by checking his wholesale numbers and the shipment costs. "Then I'll make a quick ride around the neighborhoods, I check my margins, add a couple pennies. But we think the $4 is the red line that we shouldn't cross...$3.99 is definitely much more effective than $4."

Contrary to popular belief though, Elam said he isn't ...


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Submitted Feb 21, 2013 By: BurntOrange
Category: Daily News Article Discussions > Topics Add to favorite topics  
Author Topic: Why gas prices vary from station to station Back to Topics
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honda0105
Champion Author Tallahassee

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Message Posted: Feb 26, 2013 12:00:35 AM

other than greed on Pig Oil's part, no reason for prices to be this high.
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honda0105
Champion Author Tallahassee

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Message Posted: Feb 25, 2013 5:58:57 AM

lukus, indeed they are doing it again.
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beachd8
Champion Author Orange County

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Message Posted: Feb 22, 2013 6:09:50 PM

Oh, Elam needs to study accounting & economics . . . good stuff to know.
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beachd8
Champion Author Orange County

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Message Posted: Feb 22, 2013 6:08:16 PM

$3.99 sounds good right now. That station owner can move to my neighborhood anytime.
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EssexAdri
Champion Author Jacksonville

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Message Posted: Feb 22, 2013 4:25:46 AM

I don't question Mr Elam's personal method for pricing in his store, but to imply that, that is the norm for the industry doesn't hold water. If it actually was the norm, then all gas prices in an area would be roughly the same, we'll say a 3-7 cent difference over-all.
But unless you're in the smallest of towns (where there's only a couple of stations to begin with), you see that it is not the case. To explain I'll give you 5 examples:

San Diego, CA - Rosecrans Blvd
Jacksonville, FL - Atlantic Blvd
Washington, NC - Hwy 17/32/264 (Pactolos Rd/5th St/John Small Ave)
Raleigh, NC - CApitol Blvd
Virginia Beach, VA - Virginia Beach Blvd

In the past 10 yrs I have driven on each of these roads several dozen to several hundreds of time, each.
You see one price, that you're not happy with paying, so unless you have no choice, you hold out until the next station, then 5 blocks down the road you see another station, but this time the price is 5 cent higher, then half a mile down its 7 cent higher than the last, then 3 blocks further down it 5 cent cheaper than the last, then 5 or 6 blocks down its 9 cent higher than the highest you've previously seen, through the rest of the road if you keep going you see a similar pattern. Over a 2 mile stretch of the same road/street you've seen a price differeNCe of 21 cents.
Take it on a little larger distance scale. Drive up I-95 through Georgia. Gas at exit 49 (all stations at exit 49) is consistently 13-17 cent higher than it is at exit 46 three miles back, then at the next exit, 51 or 52 (I don't remember if its 2 or 3 miles to the next exit after 49) it is consistently 9-12 cent "cheaper" than it was at exit 49. Then the next exit after that one is usually 2-5 cent "cheaper" than that one, and prices stay within 2-5 cent of that price all the way until just before you get into the Savannah area around exit 80.
Take it on a smaller scale. There are atleast 6 different areas in Jacksonville, FL & atleast 4 in Virginia Beach, VA where there are 2 stations less than a block from each other, but on different sides of the street, and 1 of those 2 (consistently the same 1) is always 8-15 cent cheaper than the other.

Sure there are ethical & honest station owners out there, ones that charge a fair price based on what they paid at whole sale, but there's nowhere near as many of them as the industry tries to make us believe. There is "MASSIVE" price gouging going on at gas stations. The whole oil industry from the ground up knows through statistics and common sense certain periods that more people are driving, and driving further, so the refineries storage facilities know when they need to ramp up production & distribution. So why is it that every Easter, 4th of July, Thanksgiving, & Christmas the prices jump 10-15 cent the week prior, and then 5-15 cent more 1-2 days before the actual holiday, and always start slowly dropping 3-5 days after the holiday, taking atleast a week from when they started dropping to settle back down to the price where they were a week and a half before the holiday?... ...the answer... ...Deliberate, Planned, Conspired Price Gouging...

It is against the law. So why are these station owners not being charged & prosecuted? I'm serious when I ask that. The primary penalty for price gouging is fines, with jail time possible, depending on the severity & if a natural disaster is involved. This would be a plus for city or county governments, because would be considered small scale under the price gouging laws, and therefore be under their jurisdiction & responsibility to prosecute, making them the benefactors of the imposed fines...
So why is it that no law enforcement on any level is enforcing the law in this regard?...
I honestly can't propose an answer to that one. But I can certainly say that having a president that has both face to face and through Executive Orders, ordered the Federal DA not to enforce certain laws that he (the president) doesn't like or are inconvenient to him and his party, doesn't help the matter of enforcing any law.

[Edited by: EssexAdri at 2/22/2013 4:29:24 AM EST]
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NedW
Champion Author Indianapolis

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Message Posted: Feb 22, 2013 1:07:38 AM

Thank you for submitting this article, BurntOrange.
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satanzangl99
Rookie Author Columbus

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Message Posted: Feb 22, 2013 12:49:13 AM

ok
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KrsnaDragon
Champion Author Montreal

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Message Posted: Feb 22, 2013 12:45:57 AM

Here in Montréal there's usually not much variation. I'd love to read more articles about gasoline pricing locally, at the retail level.
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ShadowACE
Champion Author Boston

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Message Posted: Feb 22, 2013 12:42:22 AM

Bigoilscamsus20 said "What we need is for Congress to set price and profit controls on all petroleum products in America!"

WHOA, Big!! Whatever you've been smoking and/or drinking has apparently turned your brain to mush. Congress is the LAST entity that we would ever want to "set price...controls" on almost anything! Have you noticed how many zeros are following the real numbers in the national debt lately? Or the fact that they haven't been able to create an actual budget for years? And you want THEM to set the price of gas!?!?! We'd be paying $30/gallon before the end of the year - and NONE of that money would go to maintain the roads!
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ican2step
Champion Author Pittsburgh

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Message Posted: Feb 22, 2013 12:39:33 AM

33 straight days???????????????
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Cableman66
Champion Author North Carolina

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Message Posted: Feb 22, 2013 12:37:32 AM

Don't worry just feed the machine and enjoy the ride. Just remember Obama has our back. He's going to take care of the working class of people. Takers will out number the makers and what wonderful world that will be. Just watch the world news and see your future.
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defiancegasman
Champion Author Ohio

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Message Posted: Feb 22, 2013 12:36:28 AM

TOTAL BULL!!!

Gas goes UP every time BIG OIL has one of their PLANNED DOWN TIME at the REFINERS!!! There is a GLUT of WORLD OIL right now. The Saudi's even cut oil production by 1 million barrels a day because of over supply!!!
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unicornpmb
Champion Author Buffalo

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Message Posted: Feb 22, 2013 12:33:45 AM

Because they can.
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wshokie12
Champion Author Winston-Salem

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Message Posted: Feb 22, 2013 12:32:02 AM

I'm still amazed when I see people paying as much as .05 cents more at a station accroos the street.
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badharley
Champion Author Tampa

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Message Posted: Feb 22, 2013 12:30:39 AM

Just GREED.
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crreed1
Champion Author West Virginia

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Message Posted: Feb 22, 2013 12:29:23 AM

don't buy gas unless you have too
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jetskijerry
Champion Author North Carolina

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Message Posted: Feb 22, 2013 12:27:21 AM

it's a real problem
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jetskijerry
Champion Author North Carolina

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Message Posted: Feb 22, 2013 12:27:06 AM

no go
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10k
Champion Author North Carolina

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Message Posted: Feb 22, 2013 12:27:03 AM

.."..But we think the $4 is the red line that we shouldn't cross..."..

what in the h*ll kinda price does he think $3.999 is ??..one gallon: $4.00..ten gallons: $39.99, one whole penny from $4/gallon..
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J Eric
Champion Author Los Angeles

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Message Posted: Feb 22, 2013 12:24:44 AM

Oh, yeah, drive around the neighborhood, see what others are selling for and "add a couple pennies." Real intelligent way of being price-competitive.
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RAE344
Champion Author Virginia Beach

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Message Posted: Feb 22, 2013 12:24:26 AM

The gas producers have a strangle hold on the gas stations owners. They control the prices not the station.
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mfeldstein
Champion Author Ottawa

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Message Posted: Feb 22, 2013 12:24:21 AM

Could it be competition?
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Bigwaynef
Champion Author South Carolina

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Message Posted: Feb 22, 2013 12:23:28 AM

Same here not that much varience, we do have a couple stations that really jack the prices though...
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shopnshop
Champion Author Dallas

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Message Posted: Feb 22, 2013 12:23:14 AM

getting higher prices
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boatfloyd
Champion Author Jacksonville

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Message Posted: Feb 22, 2013 12:22:31 AM

I guess if everybody starts making their own coffee, the gas stations will have to go out of bussiness.
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mlmeng
Champion Author Michigan

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Message Posted: Feb 22, 2013 12:22:14 AM

"...33 straight days of increases..."

It can only get worse.
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ricebike
Champion Author New Jersey

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Message Posted: Feb 22, 2013 12:21:51 AM

ok i thought it was zone pricing
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pastorpaulcg
Champion Author Virginia

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Message Posted: Feb 22, 2013 12:21:11 AM

there's not too much variance around here
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CCLighthouse
Champion Author Hartford

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Message Posted: Feb 22, 2013 12:20:49 AM

Night folks!
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TheeRedRam
Champion Author Hartford

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Message Posted: Feb 22, 2013 12:18:03 AM

More Madness
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jkpsr
Champion Author New Jersey

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Message Posted: Feb 22, 2013 12:17:45 AM

It is a problem with the speculators.
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tedjm1
Champion Author New York

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Message Posted: Feb 22, 2013 12:17:44 AM

Stations are tough to run.
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singlemom27
Champion Author Ventura

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Message Posted: Feb 22, 2013 12:17:31 AM

Station owners are squeezed until it hurts...Big Oil is where the money goes.
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ScottTee
Champion Author Detroit

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Message Posted: Feb 22, 2013 12:17:00 AM

screwed again
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Rooster922
Champion Author Wilmington

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Message Posted: Feb 22, 2013 12:16:39 AM

Well . . . . location, location, location . . . I don't know, bro.
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CivicMA
Champion Author Boston

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Message Posted: Feb 22, 2013 12:13:59 AM

More interesting is that stations near each other tend to have very similar pricing, so as not to compete.
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pa79th
Champion Author Pennsylvania

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Message Posted: Feb 22, 2013 12:13:51 AM

Greeeeeeeeed!
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obimerrill
Champion Author Cincinnati

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Message Posted: Feb 22, 2013 12:12:20 AM

A lot of psychology in 3.999 vs.4.009...3.999 does look better to us!
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regout
Champion Author Quebec

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Message Posted: Feb 22, 2013 12:11:30 AM

Because speculators want more money.
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unclenorman
Champion Author Tampa

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Message Posted: Feb 22, 2013 12:11:27 AM

Why use a place in NY? NY is a defective culture,try somewhere else!!!!!!!!!!!!!!
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Matt G
Champion Author Boston

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Message Posted: Feb 22, 2013 12:11:03 AM

How about trying to price it to make a living
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naspa
Champion Author Cleveland

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Message Posted: Feb 22, 2013 12:10:56 AM

Wall street is the mother of all wrong in this country.
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N5EXY
Champion Author Austin

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Message Posted: Feb 22, 2013 12:10:39 AM

Maybe it is competition and free enterprise?
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bigsranch
Champion Author Houston

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Message Posted: Feb 22, 2013 12:10:21 AM

Typically, a station's competition on price is on the same intersection or within a couple of blocks. Depending on how profitable their C-store is, some stations can afford to charge less. In affluent areas, they can charge more because the rich folk don't shop around.

Supply and demand, not greed, drives the price.
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Rageagainsttm
Champion Author Tampa

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Message Posted: Feb 22, 2013 12:10:16 AM

$3.999 is really $4. Agreed.
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BALRSTATUS
Champion Author Grand Rapids

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Message Posted: Feb 22, 2013 12:09:20 AM

nice
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sjhman
Veteran Author Atlanta

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Message Posted: Feb 22, 2013 12:07:35 AM

Very interesting
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BobD2009
Champion Author Long Island

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Message Posted: Feb 22, 2013 12:07:11 AM

$3.999 is really $4.
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Glock26
Champion Author Dayton

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Message Posted: Feb 22, 2013 12:06:26 AM

Greed!!!
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millerin
Champion Author Orlando

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Message Posted: Feb 22, 2013 12:06:25 AM

making money
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