Friday, March 28, 2014

The corner station retreats again, but only two cents worth

I predicted very little movement in Good news, everyone--I was wrong.
As for what next week holds, I expect no or little change, with prices remaining between $3.49 and $3.59, except for a charge into No Man's Land by the corner station followed by an quick but orderly retreat.
The corner station stayed in its trench on Tuesday, so there was no charge into No Man's Land this week.  Instead, the three stations down the street dropped their prices slightly to $3.54, where they've remained since.  The corner station dropped a penny Wednesday to $3.55, then matched the rest of the outlets in the neighborhood Thursday at $3.54.  I predicted local prices would end the week between $3.49 and $3.59, and all four of them ended up exactly in the middle of the range.  Perfect.

As for what's next, Gas Buddy shows that metro Detroit prices hit a low for March of $3.59 last Friday, then shot up over the weekend to $3.65 before resuming their steep glide down to Thursday's $3.61.  I wouldn't be surprised if they continued to drop.  I would expect $3.52, but the low end of the range at $3.49 is still possible if Detroit area prices continue to drop.  However, there is upward price pressure from the national average, which ceased its brief decline on the 21st at $3.51 and has resumed its slow and steady rise to $3.52.  If that trend continues, then it will set a floor on local prices and possibly push them up to the top of the range I set last week, which is $3.59.  Unless something drastic happens in the next seven days, I don't expect prices to go any higher.

As I wrote last week, even if gas prices do go up next week to $3.59, they'll still be lower than at this time last year, when they fell from $3.79 to $3.69.  Lower prices year-over-year and a price drop--this week deserves Professor Farnsworth, again.

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