Gasoline Prices Go Up & Down But Mainly Down: Analyst
Gasoline prices took a roller-coaster ride in Champaign-Urbana in the past few days. They fell below two dollars for a gallon of regular last weekend. Then, a day or two later, those prices had spiked up by about 30 cents.
But the gas price tracking website, GasBuddy.com, says Champaign-Urbana gas prices are falling again --- having reached an average of $2.20.9 for a gallon of Regular, as of Wednesday evening.
GasBuddy says that rise-and-fall, or saw tooth pattern in gas prices reflects the heavy emphasis on price competition for gasoline retailers in the Great Lakes states. GasBuddy analyst Patrick DeHaan says it’s common to see prices fluctuate, as retailers balance the need to compete with the need to maintain a profit margin.
“And they whittle down, they fight back and forth, they continue dropping prices, to the point where one has to essentially wave the white flag,” said DeHann. “And then that station goes up, quickly followed by the station nearby, or another station across the street. And then that filters down to other stations in the area.”
Gasbuddy.com reports that seveal Danville area gas stations are selling Regular below $2 a gallon. And DeHaan says he expects gasoline prices in other parts of central Illinois to fall below 2 dollars a gallon again this fall and winter, in part because he expects the price of oil to remain low. He thinks recent increases in oil prices constitute a “head fake” aimed at the market.
“I think oil prices still have significant headwinds to fight off,” said DeHaan. “We still are seeing oil inventories that remain in far excess of where they were a year ago. And I think that ultimately by Thanksgiving and Christmas, we will see prices lower than they stand today.”
DeHaan says gasoline prices are typically lower in the winter months anyway, due to less driving being done, and the switch to less expensive winter motor fuel blends.