Gasoline Is Selling for 12 Cents a Gallon

[Wathen1955]

and Nobody Wants It
https://www.yahoo.com/finance/news/g...100000541.html

(Bloomberg) -- In Fargo, North Dakota, cheap fuel has never been so unwelcome.

The Midwestern city is so awash in gasoline, the fuel last week sold for a record 12 cents a gallon at the rack -- its last stop before the pump. In better times, the price dip would be a boon for gas station owners looking to snag low-cost supplies. But with fewer customers every day, gas pumps are becoming little more than makeshift storage for ballooning inventories.

“Our gasoline business has been cut in half,” said David Olson, general manager at family-owned RJ’s Gas Station near Fargo. Across town, Shaun Lugert estimates that sales at the station he owns have tumbled 80% in a month. “The biggest part for us that has been so hard is the unknown,” he said by phone. “It’s been kind of a roller coaster.”

The slump in rack prices, which are typically stable due to intense competition among distributors, is the latest sign that the coronavirus pandemic is wreaking havoc on every aspect of the fuel market. American gasoline consumption fell to the lowest level on record last week as lockdowns take drivers off the road while gasoline stockpiles rose to a record high. That’s caused rack prices across the U.S to collapse. Milwaukee this week beat out Fargo for the lowest price in the nation.

“The local racks are just inundated with material,” said Patrick De Haan, head of petroleum analysis at GasBuddy. Some refineries may even be selling gasoline “at a break even or even a loss,” he said.

The price decline is especially pronounced for cities at the end of pipeline systems, such as Fargo and Milwaukee.

“Those places are at the end of the line,” said DTN refined products analyst Brian Milne. “What we are seeing is that a lot of the big pipelines are being used as storage, and the product will just get pushed and pushed until it has no place else to go.”

While everyone along the supply chain is getting hammered right now, gas stations may have it the worst.

“When you see gasoline down around 12 cents a gallon, no one is going to be making money,” said Ron Ness, president of the North Dakota Petroleum Council. For retailers, it’s nearly impossible to turn a profit, he said.

I heard in San Francisco and San Diego, gas is still well over $3/gallon.

[boracayjohnny]

Here in L-A, gas is below $3/gal. My last fill up at Costco was 2.659 for Premium.

[Bill]

Seems like there might be a good opportunity for arbitrage for jobbers, independent fuel haulers. They could go buy the $ .12/gal gas and truck it anywhere where gas is normal price, although I just filled up with regular for $ 1.49, so I don't know if, after the shipping it would actually be worth it. I guess it depends on how close you can go to sell fuel for a more normal (for the current market) price.

This also highlights the need for a robust pipeline transmission line system, so product can move about the country as needed.

[snide]

Originally Posted by boracayjohnny

Here in L-A, gas is below $3/gal. My last fill up at Costco was 2.659 for Premium.

I would have thought that gas would cost less in Lower Alabama...

[joecaver]

I paid $1.55 the other day here in NW GA

[Raazor]

$1.69 in Montucky

[Black94lt1]

1.19 at one station near me

[DJ_Critterus]

$2.07 for diesel here in Jax.

[Vandelay Industries]

Filled up for $1.39 at Costco this week.

[Mick]

About $2 per gallon here, still very cheap comparatively. It is time to turn over the gas for my generator. I am thinking of filling an extra can or two just to take advantage of the price.

[markids77]

$1.61 for regular is the lowest I have seen locally.

[boracayjohnny]

Originally Posted by snide

I would have thought that gas would cost less in Lower Alabama...

Why you hanging out in the Redneck Riviera? Yankees don't belong there.

[dvarapala]

Originally Posted by Wathen1955

I heard in San Francisco and San Diego, gas is still well over $3/gallon.

Last time I filled up (over a week ago) 91 octane was > $3/gallon.

Energy companies continue to gouge California Enron-style because they can.

[Bill]

Originally Posted by dvarapala

Last time I filled up (over a week ago) 91 octane was > $3/gallon.

Energy companies continue to gouge California Enron-style because they can.

Pro-tip: It's not the oil companies making bank, it's all the regulations that make it difficult to do business in CA that jack the price up, always in that state.

[MEANZ06]

I don't do gas, I do fuel (diesel) and I'm topped off. I don't care what it cost, I'm getting to where I'm going

[Anjdog2003]

Originally Posted by Raazor

$1.69 in Montucky

They're losing money with only 900 cars in the entire state.