12-9-25 *INTERVIEW* Patrick DeHaan with GasBuddy Talking Gas Prices

Episode Transcript

Speaker 1 (00:00):
Patrick to Hahn waiting right now. And when I see
a headline like why Denver has some of the lowest
gas prices in the country and at a time when
gas prices are going down nationally as well, I know
who I need to talk to. We need to talk
to Patrick to Han from gas Buddy, and he has
his own substack called Fuel Insights. But if you go

(00:23):
look for Patrick to hand e h a a n substack,
you can find that. You can find his own website
as well. And I was really happy to notice that
Patrick liked one of my tweets yesterday. It's good to
talk to you again. Patrick, It's been a while. Thanks
for doing this. Hey you betcha thanks for having me back. Yeah,
glad to do it. Before we get to the local
Denver and Colorado stuff, I saw a headline, I saw

(00:47):
a story over it over at your substack, average US
gas prices see weekly dip again, fresh multi year low reached.
So tell us a little bit about you know what
the pricing is, and you know when you say multi
year low, how many years? And how are you thinking
about the significance of this?

Speaker 2 (01:08):
Yeah, you know, seasonally, this is something we see almost
every year. Gas versus declining. As we get into the
cooler weather, Americans do not get outside as much, especially
as the snow starts to fly. I know they're the holidays,
but demand for gasolings relatively low. So that's why you
know where we are where we are the national average
two ninety three gallon. You know, for the last three

(01:29):
years we have gotten so close to the national average
falling below the three dollars a gallon mark. Last year
we did it for a couple of days. In fact,
a year ago the national average was two point nine
nine nine. It's about seven cents lower today. But it's
been nice to see the decline this year has gotten
a little bit more steam that his price is falling
just a bit more this year than the last couple

(01:50):
of years. A lot of that due to additional oil
production that Opek, who has increased output for much of
this year, has added to global supply, and that's why
prices are moderately lower today. Now in Denver, just about
everything is going right that can go right, and that's
why you're seeing the lowest gas prices in the nation.
In fact, a lot of stations in the area engaging

(02:13):
in a bit of a price war At a dollar
sixty nine a gallon your refinery and commerce city handles
cheaper Canadian oil. The price of that Canadian oil today
about forty seven dollars a barrel. You know, we're seeing
lower demands seasonally, we're on the winter blend of gasoline.
That's not actively reason why prices are lower or pushing

(02:34):
them lower, but that's one of the reasons prices are
so low to begin with. But you just look across
the board, everything's going right. This gasoline that comes out
of your refinery and commerce city can't really be exported,
so the only way to get rid of it is
to discount the heck out of it. And that's what
we're seeing. In fact, Denver some of the lowest average
prices in the nation, with the lowest individual stations, like

(02:56):
I think there's probably two dozen stations at a dollar
sixty nine areas as a metro. So just really nice
to see all the factors align.

Speaker 1 (03:03):
One of the things in Patrick, we got about three
minutes left here. One of the things I've long wondered
about regarding the gas station industry is do they or
how much do they attempt to compete based on the
price of gas. You go to some intersections where they
got gas stations on diagonal corners or whatever, and you'll
see the prices are just the same. Sometimes you'll see

(03:24):
the prices are quite different, although I usually see that
in places where it's a very large intersection. So depending
on where you're going, it might be hard to get
to the cheaper station. But is there really competition in
gas prices? The other thing is like you'll see let's
say two dollars and nineteen cents, and then not across
the street, but three blocks down the street it's two

(03:46):
dollars and eighty nine cents.

Speaker 2 (03:48):
Yeah, I mean to your point, you know, we're seeing
these factors. The ultralo price is happening primarily because competition
is so high. You're seeing new stations coming into Denver,
companies like quick Trip. You know, they's been a lot
of talk about BUCkies. These big gas stations that have
a lot of locations are kind of new entrance to Denver.
And the best way to get people to see that

(04:08):
you're on the map is say, hey, we got a
dollar sixty don gas, come on swing buy. So Denver
is very unique to some other areas like Ohio, where
there's just really intense competition through some of the names
of these big brand retailers, and that's why prices are
so low right now. But competition is still a huge factor.
Some gas stations simply much more aggressive because they want

(04:30):
you to realize that, hey, we're in the market, whereas
other stations, well they may not be competing at as
high of a level as some of those big box
stores that are coming into the area.

Speaker 1 (04:40):
One quick follow up on that, when gas stations are
aggressively lowering the price of gasoline, how much of that
is do you think is because they want you to
know they exist and come back later? How much of
that is because they want you to stop and come
in and buy something in the store.

Speaker 2 (04:54):
Well, all of the above, and maybe even sign up
for their loyalty program. Absolutely, so all of those factors
could be put prices down because do enjoy it. I
will say those stations at the dollars sixty nine today,
they are not clearing much, if any profit, So a
lot of this is a price for But you know,
when businesses don't make money, it's generally hard to say
in business. So I don't know how long those ultralow

(05:16):
sub two dollars. Prices are going to last, but you know,
maybe get out there and fill your tankup while they do.

Speaker 1 (05:22):
We're talking with Patrick de'han, head of petroleum analysis for
gas Buddy, his own website, Patrick d'han dot com. That's
d E H A A and I have literally just
less than a minute here, Patrick, When is the last time,
if ever, that you have seen such a huge gap
between the price of diesel and the price of unleaded gasoline.

Speaker 2 (05:43):
Well, you know, probably during the pandemic, or I should
say shortly thereafter. You know, the two fuels, though they
both come out of the refinery, they're very different. Consumers
drive less in the winter, there's less gasoline demand, but
on the diesel side of things, diesel demand peaks in
the winter because diesel and heating will well are the
same thing. So you talk about the cold weather right
now in areas of the country, the Northeast getting hit

(06:05):
with some extremely cold weather that actually spurs demand for diesel.
And of course the economy. Trucks, trains, you know, planes
use a subset of diesel. Jet fuel is very similar.
So you talk about just completely different dynamics for gasoline
versus diesel.

Speaker 1 (06:22):
Fascinating. Patrick d'han, head of petroleum analysis for gas Buddy.
It's got his own substack called Fuel Insights, which is
awesome and I subscribe to that. Arguably the nation's leading
public expert on oil and gas and diesel prices. So
good to have you on the show again. Patrick, thanks
for being here, and thanks for liking my tweets. Appreciate it.

Speaker 2 (06:41):
Hey, thanks for having me.

Speaker 1 (06:43):
Always appreciate it too, all right, that's awesome.