Michigan Gasoline Prices Increase but may Fall Soon

Drivers in West Michigan just witnessed an unwelcomed increase in their gasoline prices. However, a massive stock rise should lead costs to fall soon, according to an analyst.

Several areas across West Michigan saw a surge in their gasoline prices today by almost 30 cents. That is something that  is caused by what is known as “price cycling.”

That is a widespread phenomenon in the Great Lakes area that occurs when stations are competing with each other.

The decline in the current price of retail gas surpassed the prices of wholesale gas, sparking a restoration of the margin between the two.

Metro Grand Rapid’s gasoline price today fell within the $3.31 to $3.55 range, according to the price tracking data. The price of gasoline in Muskegon is between $3.43 and $3.57 per gallon. Moreover, gas price tracking websites are reporting Holland’s prices at the pump from $3.51 to $3.56 per gallon.

But gasoline inventories are high and may cause the current gasoline prices to fall by at least 10 cents. Recent reports show that these inventories are higher by 8 million barrels.

The effect on commodities will most likely be significant, with gasoline prices today most probably losing a good amount of pricing value. Yet, drivers may see the price of gasoline reach a record high by Christmas.

In the past year, the nationwide average was around $3.238 a gallon, and the record high can certainly be broken again this year.

By: Chris Termeer

Chris Termeer

Chris Termeer is an oil and gas consultant, industry commentator and analyst. His book, Fundamentals of Investing in Oil and Gas provides a comprehensive overview of all aspects of the oil and gas industry, including exploration, drilling, production, storage, transportation and refining, to name but a few.

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