The Dropping Price of Gas
A couple of weeks ago, I filled up the tank. Prices at that time were $1.27/L. I was surprised at the time. I wondered to myself why prices were much lower than the previous time I filled up. Thinking nothing of it at the time, I finished filling up and left the gas station.
I find it interesting how prices have dropped in the past few weeks. It seems like yesterday the media was publishing stories of the imminent rise of gas prices. Some media even published reports that gas prices were expected to set a new record by hitting $1.50/L!
Of course, prices now are a shade under $1.20/L.
Despite these low prices, there are media outlets that are airing interviews from "experts". These "experts" are predicting prices will rise again shortly!
Well, I have no doubt about that. Gas prices are always fluctuating. I could probably call myself an "expert", go on TV or radio, and say prices will fall again shortly.
So why are gas prices much lower than before?
I have no idea.
I suspect one reason is the price of crude oil. Seems a few weeks ago, the price of oil was over $100 a barrel. Last time I heard, the price of oil was $85 a barrel.
So why is the price of oil dropping?
I have no idea.
I heard one theory today: Speculators pulling out of the market.
I'm not sure if there is any credence to these theories. Seems to me, there would have to be a lot of speculators thinking bad things about the future of oil in order to drop the price by more than 15%.
So what do you know?
Well, I know enough to not care about the fluctuating gas prices. Prices are going up 3 cents a litre? Okay, great. Whatever. Prices are dropping overnight by 1 cent a litre? Yeah, yeah.
The thing with gas is that you need it when your tank is near empty.
What are you going to do when you running on empty and you still need to commute the next day? Not fill up?
Unlikely.
The opposite is also true. Do you really need gas if prices are expected to rise 3 cents a litre and you still have half a tank?
Probably not.
Then why are people lining up for gas when the media announce that gas prices are expected to rise the next day?
Assuming prices are going up an unimaginable 6 cents a litre and assuming a car with a 46 L tank that is half empty (or half empty), that's $1.38 in savings.
Whoop-dee-doo!
You saved enough money to buy yourself a small double-double at Tim Horton's.
Was lining up for 15-20 minutes to buy gas worth the $1.38 you saved?
At $1.38/15 minutes, that's $5.52/hour. Is your time worth $5.52/hour? Would you take a job that pays $5.52/hour? To give it some context, Ontario's minimum wage is $11/hour.
Sheesh!
Of course, there are times you cannot avoid lining up for gas. Sometimes, you run out of gas the same day gas prices are expected to rise at midnight... In these situations, I either wait until the next day or, if there is no line at the gas stations on my way home, I will fill up just before the expected rise in price.
This situation hasn't happened to me in a while as I generally fill up the tank on weekends when the gas stations are less busy.
Ideally, I don't use the car at all. That won't happen until I find a job that doesn't require the car or when I retire.
I find it interesting how prices have dropped in the past few weeks. It seems like yesterday the media was publishing stories of the imminent rise of gas prices. Some media even published reports that gas prices were expected to set a new record by hitting $1.50/L!
Of course, prices now are a shade under $1.20/L.
Despite these low prices, there are media outlets that are airing interviews from "experts". These "experts" are predicting prices will rise again shortly!
Well, I have no doubt about that. Gas prices are always fluctuating. I could probably call myself an "expert", go on TV or radio, and say prices will fall again shortly.
So why are gas prices much lower than before?
I have no idea.
I suspect one reason is the price of crude oil. Seems a few weeks ago, the price of oil was over $100 a barrel. Last time I heard, the price of oil was $85 a barrel.
So why is the price of oil dropping?
I have no idea.
I heard one theory today: Speculators pulling out of the market.
I'm not sure if there is any credence to these theories. Seems to me, there would have to be a lot of speculators thinking bad things about the future of oil in order to drop the price by more than 15%.
So what do you know?
Well, I know enough to not care about the fluctuating gas prices. Prices are going up 3 cents a litre? Okay, great. Whatever. Prices are dropping overnight by 1 cent a litre? Yeah, yeah.
The thing with gas is that you need it when your tank is near empty.
What are you going to do when you running on empty and you still need to commute the next day? Not fill up?
Unlikely.
The opposite is also true. Do you really need gas if prices are expected to rise 3 cents a litre and you still have half a tank?
Probably not.
Then why are people lining up for gas when the media announce that gas prices are expected to rise the next day?
Assuming prices are going up an unimaginable 6 cents a litre and assuming a car with a 46 L tank that is half empty (or half empty), that's $1.38 in savings.
Whoop-dee-doo!
You saved enough money to buy yourself a small double-double at Tim Horton's.
Was lining up for 15-20 minutes to buy gas worth the $1.38 you saved?
At $1.38/15 minutes, that's $5.52/hour. Is your time worth $5.52/hour? Would you take a job that pays $5.52/hour? To give it some context, Ontario's minimum wage is $11/hour.
Sheesh!
Of course, there are times you cannot avoid lining up for gas. Sometimes, you run out of gas the same day gas prices are expected to rise at midnight... In these situations, I either wait until the next day or, if there is no line at the gas stations on my way home, I will fill up just before the expected rise in price.
This situation hasn't happened to me in a while as I generally fill up the tank on weekends when the gas stations are less busy.
Ideally, I don't use the car at all. That won't happen until I find a job that doesn't require the car or when I retire.
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