Gas Price Differences Explained by Industry Analyst

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WEST POINT, Miss. (WCBI) — If holiday shopping has taken you out of town, you may have noticed a big difference in gas prices. If so, you’re not alone. It’s a question viewers ask the WCBI Newsroom a lot.

There’s one town in particular that drivers have noticed. Gas there is nearly 30 cents cheaper per gallon. There’s a lot of speculation as to why, so WCBI reached out to an industry analyst for the answer.

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“It’s about .35 cents a gallon cheaper,” Vicki Powell said.

And that’s enough for her to drive from Columbus to West Point.

“We made the trip up to this Walmart and got gas while we were here,” Powell said.

She enjoys the savings.
But wonders why, recently at least, it seems, a gallon of gas costs less in West Point than most other places in the Golden Triangle.

So WCBI reached out to gasbuddy.com, the people who track gas prices, and spoke with Senior Petroleum Analyst Patrick DeHaan.

“It looks live everyone’s kind of in different places, these three towns are all kind of in a different phase of pulling prices,” DeHann said.

In West Point, DeHaan said the lower prices probably started with one store.

“That Murphy USA, like I said, is very aggressive and so they’ve brought prices down and competition immediately around them has had to match the price. That’s why prices in West Point are all low, because that Murphy is pushing prices down,” DeHann said.

He said one station, that purchased fuel for a lower price or just wants to be competitive, can start a price war.

“We have seen price wars where stations will lose money, and it’s just about ego. One station doesn’t want to get beat by the other stations lower price,” DeHann said.

Something Powell admits she doesn’t mind.

“I like competition, it’s always good for the consumer,” Powell said.

The analyst said the stations that temporarily lose money can make it up with c-store sales and by waiting until they purchase fuel at a lower price, and then keeping the price consumers pay the same.

The analyst said the holidays typically don’t have an impact on price, demand would have to be elevated for several weeks to affect prices-like during summer. He said one thing drivers should keep in mind; if you cross state lines know what the gas tax is in that other state, because that could drive up prices there.

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