“They’re going start raising gas prices again, you know.”
“The people in charge of them. They do it every year at this time.”
“Because they can.”
That’s a real conversation and the person making those broad statements is not alone. It’s also one of the reasons why, for the past two decades, NACS has published resources to help explain why gasoline prices typically increase in the spring.
Originally, we focused on publishing resources on Feb. 2 for two reasons. One, the first week of February is the time when the industry gears up for summer-blend fuel. The slight lull in demand between the winter holidays and summer drive make it an ideal time to catch up on refinery maintenance, called “turnarounds.”
At the same time, the refining industry is producing more than a dozen gasoline blends that are required by different regulations across the country. This all creates pressure on the system, and any disruptions (wars, OPEC production cuts, oil strikes, pipeline disruptions—you name it) can accelerate problems. Seasonal Gas Prices Explained goes more in depth.
The second reason we focused on Feb. 2: Groundhog Day. That’s not to say we are devoted fans of the furry varmint from Central Pennsylvania that predicts the seasons. It’s based on the movie “Groundhog Day,” in which Bill Murray’s character experiences the same events over and over … and over.
The retail fueling market is like the movie “Groundhog Day” in that it experiences similar conditions over and over—except on an annual, rather than daily, basis.
Okay, and there’s Bill Murray, who is known for doing random things when he’s not making movies. Once, he got behind the counter at a Texaco station in Menemsha, Massachusetts, to work the register. The owner was in on the joke. Customers recognized him and asked, “Why is Bill Murray running the register?” as they put a candy bar and bottled water on the counter. Murray’s reply: “That'll be $147.51 please.”
Joking aside, the above reasons made sense on an intellectual level. But here’s the things: Gasoline prices are an emotional issue. People care about gas prices when they see them going up. That typically happens in early April. So here we are, gas prices have jumped about seven cents in the past week, and we are hearing those conversations. The time is right to highlight our online resources.
First, there is a lot of angst among American drivers right now. We haven’t seen this level of pessimism in the nearly 20 years we have conducted national consumer surveys.
Drivers are concerned about the economy, and gasoline prices factor into that concern. Drivers tell us they will seek out the best price they can find on gas, even if it’s inconvenient. In fact, nearly three in four drivers (71%) will drive 5 minutes out of their way to save 5 cents.
While drivers aren’t in a good mood, and gas prices is a reason why, they don’t blame the retailer for their pain. In fact, in a listing of 10 factors that contribute to gas prices, convenience stores were ranked 9th, with only 27% of drivers saying the retail location was a big factor. And they’re right. Government data shows that “retail and distribution,” which factor in all costs in getting fuel from the refinery to the dispenser, was only 12% in 2022, the year when gas prices set record highs.
The top factor that drivers cited for gasoline prices: Oil Companies (cited by 60% of drivers). But it’s worth noting that oil companies make their profits off oil prices, not gas prices. And retailers, despite the branding on the canopy, are not all owned by oil companies.
We know there are a lot of things weighing on people’s minds and gasoline prices are one of them. It’s even more frustrating when they don’t know why gas prices are high—or rising. That’s why we created the Fuels Resource Center.
Although none of our NACS resources will reduce the price of the next fill-up, they can help you have a conversation about the complexities of retail fueling and hopefully reduce consumer frustration.