Why do the gas prices fluctuate although the gasoline in the ground stays the same?

Question

I’m asking when gasoline is put in a certain company tank on that day the price may be $3.35 when that gasoline is put into the ground why do we pay different prices through out the week? How much mark up is there in a price of gasoline?

Answer 1

It's called dollar-cost averaging. Your underground tanks are filled with gas that costs $x. You know your next fill up of those tanks will cost you $y. If you sold all the gas you purchased at $x price, you wouldn't make enough profit to buy the next delivery at $y. So you increase the sales price of the gas already in the tanks (($x + $y) / 2) to allow you to earn enough profit to pay for the next more expensive gas. And so on...

Answer 2

there ripping us off plain and simple thy all raise or lower the price according to the stock market it's just an excuse for GREED

Answer 3

Depends on the local demand and supply at that time.  Gas doesn't come straight from the ground, it has to be processed and refined.

Answer 4

Gasoline, like gold, is a commodity.  The value of the gasoline in the ground changes as the price changes.  If you have a gold ring that contains half an ounce of gold and gold is worth $350 an ounce, then that ring is worth $175.  When gold rises to $800 an ounce, that ring more than doubles in value to $400.

This is why station owners don't make much money on gasoline, because one day they may make money and the next lose even more on gasoline sales.

Answer 5

cause bush is a greedy little man

Answer 6

I think it will help if you think about the issue from a stock market perspective.  Gas is an asset like a stock.  As an asset, it has a value that is constantly changing as retailers bid to purchase gas from refiners.

Continuing the analogy, a gas retailer operates like a brokerage house.  He purchases assets from the refiner and resells them to his clients at the "current value of the asset" not at the cost at which he acquired the asset.

When prices are moving up, the retailer profits are higher because the sale price is higher than the purchase price; however when prices are moving down, the retailer profits are lower because the sale price is lower than the purchase price.  These short term price swings wash out over time and provide a relatively stable profit margin for the retailer over the long term.

See the article below for an overview of the the costs involved in manufacturing gas and the many factors affecting its pricing.

Answer 7

because theres less of it and its harder to get

Answer 8

Gas is sold at the market price, which can cause the price to be much higher than needed to create a profit. But at the same time, it could cause a loss for the gas station.

Answer 9

It changes because more gas is placed into the ground to replenish whatever gas was taken out.