Reader comments: 1
It's hard to know what caused the most disgusted looks among motorists at the Bow Mobil service station off Interstate 89 on Friday morning: the snow or the 6-cent overnight jump in gas prices.
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#1 Feb 27, 2011
There is one very important point to remember while gas prices are going up.
Every time prices go up, gas stations lose money.
If you have a ten thousand gallon tank of gas, and you have pads three dollars a gallon, you might sell it for 3.10 a gallon and use the money to buy more gas and maybe put some towards the electric bill.
But the people who sell gas are constantly kept up to date as to how much the NEXT tank will cost them per gallon. So if you have ten thousand gallons that you are selling for 3.10 per gallon, and then you are told that your next tank will cost you 3.11 a gallon, you have to raise the price so that you can afford to cover the cost of your next tank. So you raise your price. So the very next day, you are told that your next tank will in fact cost you not 3.11, but 3.13. So you have to raise your prices again.
And, if you have already sold more than half of your tank when you are informed of the price increase, you now have to make up the difference with only the 5ooo gallons you have left, or lose money on your gas, again.
No business can stay open if they are constantly losing money, so the price has to go up even further.
Your local gas station may be notified of price fluctuations two or three times a week, and they have to plan accordingly or go out of business.
#2 Mar 4, 2011
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