Wednesday, December 12, 2012

Gas price rollercoaster hits 9 month low

Time to see if my predictions in the previous installment came true.
What actually happened was that the price at the corner station shot up to $3.55 from $3.37 this morning.  Good thing I filled up yesterday.  That means the price is now more in line with the $3.61 expected from the price of Brent.

The three stations a few blocks away are still selling regular at $3.37, so I'm skeptical the corner station's price will stay that high.  I expect it to drop to $3.49, then $3.45, at which point the other stations should increase their price to match.  Let's see if that happens.
The first part indeed came true; the price at the corner dropped to $3.45.  The second part didn't, but I'm not sad about it.  The three stations down the street held steady at $3.37.  In response, the price at the corner station fell back to $3.37 a couple of days ago.  Yesterday, all four fell to $3.35.

Prices haven't been this low here since February, when the WXYZ video I embedded also shows $3.37 for regular.  The Gas Buddy graph over at Econobrowser also shows that gas in Detroit hasn't been this cheap since then, too.  In fact, the current price is close to the low for the year, which was $3.30 back in January.

Is this price high or low given the cost of Brent?  The answer is that it's low.  Econobrowser is showing a price of $108.01 for a barrel of Brent, which should result in a price of $3.51.  Time for Professor Farnsworth again.



Too bad I can't use Farnsworth for other stories in yesterday's news, but they will be the subjects of other posts.

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