If your job requires you to be on the road a lot, you probably choose your gas station based on price alone. You can make adjustments to your vehicle to help improve your mileage, like replacing your air filter or your electric fuel pump controller, but finding cheap gas can make your trip more affordable. There are few things that go into the price at the pump.
Price Matching
Consumers tend to be very sensitive about price, so gas stations will try to beat or meet their competitors posted rates in order to keep or attract customers. This is why you can usually find the same rate at the same exit between stations. This isn’t illegal or a trap. It’s a way to remain competitive.
Price Fluctuations
When prices at the pump move quickly in either direction, it usually means that the competition has started to heat up. Prices can be influenced by what the filling station down the road is doing, but it could also that the wholesale rate from the supplier has changed. Any changes to supply and demand, such as closed refineries, severe weather alerts, or traveling trends, can also impact whether the rate increases or decreases.
Geographic Location
The part of the country you are traveling through may have an effect on your final gas price as well. There are some states with higher taxes on gasoline, resulting in higher prices. Large cities are often dotted with larger gas retailers that sell considerably more gas than a mom-and-pop station. This demand means they can still charge less and turn a profit. Some of the more remote gas stations pay extra for the transport of their supply, which means they have to charge a higher cost to make up for the increased transportation expense.
Before you start to complain about the pain at the pump, look at the competition and see if the rate seems normal. Consider these factors before claiming “price gauging” and understand that it is normal for gas prices to fluctuate.
