Falling gas prices make news in Michigan, again

I expressed my astonishment in the opening of PBS NewsHour on lower oil prices.

Gas prices have continued to fall since yesterday's WOOD-TV on lower gas prices.  The neighborhood stations blew right through the $2.35 and $2.32 price levels I expected to $2.29, lower than I would have forecast for this week.  I'd be tempted to call a low for the year, but there is still another week that prices could fall before they historically begin to rise again.

I was wise not to call a bottom, as prices kept falling since then.  Thursday, the three stations down the street lowered their price for regular to $2.25, while the corner station remained at $2.29.  I expected the corner station would match them.  Instead, it undercut them, dropping its price all the way down to $2.17.  In response, the three stations down the street lowered their prices to $2.22.  That's about what should be expected from Gas Buddy, as that is a dime below the Detroit average of $2.32 on Thursday.  However, the corner station seems to have anticipated a further price drop that arrived Friday, when the Detroit average fell to $2.29.  A dozen cents lower at $2.17 doesn't seem that out of line.

Both WXYZ and WOOD-TV have noticed the latest price drop.  First, WXYZ reports, a few days later than WOOD-TV, that Gas prices drop to under $2 per gallon in Michigan.


That station is only a few miles away and might just pull down prices of stations nearby, so I'm still not calling the bottom yet.

Follow over the jump for WOOD-TV's reporting on low gas and oil prices.

Speaking of low gas prices and local competition, WOOD-TV asked Why do gas prices vary by area?

It's about whether the gas station is trying to make money at the pump or in its convenience store.

Not a bad answer.  Also note the prediction that prices will stay about where they are now for the next couple of months.

As for what the producers think, WOOD-TV reported on a Local oil man's mixed emotions over low pump prices.

Ken Langerak is conflicted whenever he pulls up to the gasoline pump, no matter the price.

One of the dynamics I described in PBS NewsHour on lower oil prices in which low prices start shutting off production is already starting here in Michigan.