April 29, 2025 • 6 mins
GasBuddy.com's Patrick DeHaan looks at the numbers and also discusses why the U.S. is NOT on board with "drill, baby, drill"
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Let's switch gears and check in on my Legacy Retirement
Group dot com phone line and talk about gas prices
pretty I don't know, pretty reasonable at this point. Just
down the streets from the radio station, we've got three
oh nine for regular, three point fifty nine for diesel.
The best in the business is gasbuddy dot COM's Patrick
d'han Patrick, summer driving season is upon us.
Speaker 2 (00:22):
What's the latest. Well, we did see a little bit
of a jump yesterday what we call a routine price syc.
A lot of Columbus saw gas stations jump up to
three twenty nine. So if you still can find that
three oh nine, I'd go fill up. But we're kind
of into the as you mentioned the gist of summer.
We've made the switch over from cheaper winter gasoline the
more expensive summer gasoline, and gas prices still down quite
(00:45):
a bit in Ohio forty seven cents lower than the
state last year, but prices are a little bit higher
than they were during the winter. Now that's typical. Gas
prices go up in the spring. Because of that changeover
to summer. Gasoline demand is going up and right now
refinery meeting is continuing. But if you look at a
map of Ohio. Really the western three counties from north
(01:05):
to south and Ohio are much cheaper than the eastern
half of the state. That's because there's a little bit
of a build up of gasoline in the western half
of Ohio. So if you're going to be hitting the
road at all, look to markets like Toledo, certainly a
great spot to fill up. But as you get closer
to Indiana, prices are tending to be a little bit lower. Now,
Indiana did not yet see one of those price cycles
(01:26):
Michigan and Ohio bullsaw prices jumping up yesterday, So if
you're encountering a station at three twenty nine, wait a
couple of days because those prices will go back down.
But for now, oil markets moving a bit sideways. A
lot of headlines to impact oil, but oil down about
ninety cents a barrel. We're back down to sixty one dollars.
We've been as low as fifty five, we've been as
high as sixty five. There's been a lot of talk
(01:48):
Iran's potential nuclear deal, Russia, Ukraine, Opek increasing production, and
then US terrace. A lot of headlines to impact those
oil markets.
Speaker 1 (01:57):
See a lot of factors that can you take a
second and explain a routine price cycle that seems like
it's sort of manufactured that prices go up for a
couple of days a week or so, then they come
back down. What causes that's? What's the purpose of a
routine price cycle?
Speaker 2 (02:13):
Yeah, Well, what we call a routine price cycle, essentially,
it's this, stations have been lowering their prices for seven
to ten days straight, regardless of if the wholesale price
of gasoline has gone up, they continue undercutting their price. Now,
if the whole seal price goes up and a station's
lowering their price, well, how are they able to do that? Well,
essentially they're depleting their own margin. After about seven to
(02:33):
ten days of lowering prices, the replacement cost begins exceeding
their retail price. So essentially what happens is when you
saw prices at two eighty or two ninety yesterday, or
even lower in somes this is two sixty two seventy,
stations are either at or below their replacement cost. And
so what they do with this routine cycle is they're
(02:53):
basically bringing their margin back from nothing up to about
thirty five to forty cents a gallon, and now from
those three twenty nine they'll start lowering again three twenty seven,
twenty five, nineteen fifteen. That'll happen for another seven to
ten days, and then we'll see prices cycle back up again.
And all of it is just a game of margins,
so that stations can always have the lowest price compared
(03:15):
to the competitor.
Speaker 1 (03:16):
Interesting, So it's not just as simple as supply and demand,
and there's I know, there's external factors, you know, geopolitically
and tariffs and all of that and how much. But
it's not just supply and demand. You know, the gas
goes in the tanks underground at one price, and then
you know, the price of oil goes up, well the
gas they've already paid for the gas in the tank.
Speaker 2 (03:38):
Yeah, and you know what instead of seeing a spike,
you know, compared to what station's actually paid, I mean,
stations can pay twenty to thirty cents a gallon more
or less than their competitor. Essentially, what you're doing is
everyone meets in the middle. That is, if a station
got their timing wrong and paid a lot more than
a competitor, the competitors paying much lower price, they meet
in the middle, and instead of having all of these
(04:00):
different prices all over town, that creates a little bit
more uniformity, right, kind of in the middle, one station
maybe taking it on the chin, the other one's doing
it really well. And that just highlights something as well
that it's all about the timing. It's kind of like
going on Amazon, right. The price can change daily one
day at maybe higher or lower, and stations have to
encounter this as well. Oil is a global commodity. It's
(04:21):
changing the wholesal price of gasoline today, by the way,
so far right now this morning, down about two cents
a gallon. So that means stations that fill up later
today will be able to take a little bit lower price,
whereas if station's filled up yesterday, they're going to be
stuck with gasoline that they paid more than the market prices.
Speaker 1 (04:37):
For Big Patrick jahangasbuddy dot com. So we do have
the summer driving season getting underway. I mean we're a
month away from Memorial Day weekend, which is kind of
the unofficial kickoff to all of that, and prices I've
used has said have bounced around a little bit. Do
we expect that to be the story this summer.
Speaker 2 (04:55):
I think so, I think for you know, unless there's
a huge headline change, and I said, there's a lot
that could change ESPUs on those issues Iran, Russia, Ukraine,
US trade war or terris, I should say, and opek,
if one of those things changes amongst those four headlines,
then we could see a different outcome. But I think
for now we're going to be teetering on three dollars
(05:16):
a gown. Some days it's going to be below, and
then when we get a price cycle, it's going to
be back above. So I think where we've been the
last month is where we're going to be most of
the summer. Barring one of those four headlines or a
refinery outitage, we've seen what can happen from those as well.
Speaker 1 (05:31):
Anything on the horizon about gas production domestically, I mean
we hear drill baby drill and using the resources we
have in this country, and we talk about pipelines and
there's on there's politics involved in that, but I mean
it seems like that we've got a lot of availability
here in this country to produce our own energy. Where
do we sit with with all of that and drill
baby drill, Well.
Speaker 2 (05:52):
We're running full till. The problem now is that, through
some of these tariff policies and OPEK raising production, American
producer don't have as much incentive. When oil is sixty
one dollars a barrel. We're actually seeing a big drop
in the rig count. We're still producing record amounts of
crude oil, but what the rig count tells you is
that in the future we may have a problem producing
(06:12):
as much as we are today. Why is that happening
because oil prices are lower. It's just like your boss
asking you to work twice as hard for half as much.
You're going to probably say no thanks. Oil companies are
starting to say no thanks to increasing production at sixty
one dollars a barrel because it's not profitable for them
Let's switch gears and check in on my Legacy Retirement
Group dot com phone line and talk about gas prices
pretty I don't know, pretty reasonable at this point. Just
down the streets from the radio station, we've got three
oh nine for regular, three point fifty nine for diesel.
The best in the business is gasbuddy dot COM's Patrick
d'han Patrick, summer driving season is upon us.
Speaker 2 (00:22):
What's the latest. Well, we did see a little bit
of a jump yesterday what we call a routine price syc.
A lot of Columbus saw gas stations jump up to
three twenty nine. So if you still can find that
three oh nine, I'd go fill up. But we're kind
of into the as you mentioned the gist of summer.
We've made the switch over from cheaper winter gasoline the
more expensive summer gasoline, and gas prices still down quite
(00:45):
a bit in Ohio forty seven cents lower than the
state last year, but prices are a little bit higher
than they were during the winter. Now that's typical. Gas
prices go up in the spring. Because of that changeover
to summer. Gasoline demand is going up and right now
refinery meeting is continuing. But if you look at a
map of Ohio. Really the western three counties from north
(01:05):
to south and Ohio are much cheaper than the eastern
half of the state. That's because there's a little bit
of a build up of gasoline in the western half
of Ohio. So if you're going to be hitting the
road at all, look to markets like Toledo, certainly a
great spot to fill up. But as you get closer
to Indiana, prices are tending to be a little bit lower. Now,
Indiana did not yet see one of those price cycles
(01:26):
Michigan and Ohio bullsaw prices jumping up yesterday, So if
you're encountering a station at three twenty nine, wait a
couple of days because those prices will go back down.
But for now, oil markets moving a bit sideways. A
lot of headlines to impact oil, but oil down about
ninety cents a barrel. We're back down to sixty one dollars.
We've been as low as fifty five, we've been as
high as sixty five. There's been a lot of talk
(01:48):
Iran's potential nuclear deal, Russia, Ukraine, Opek increasing production, and
then US terrace. A lot of headlines to impact those
oil markets.
Speaker 1 (01:57):
See a lot of factors that can you take a
second and explain a routine price cycle that seems like
it's sort of manufactured that prices go up for a
couple of days a week or so, then they come
back down. What causes that's? What's the purpose of a
routine price cycle?
Speaker 2 (02:13):
Yeah, Well, what we call a routine price cycle, essentially,
it's this, stations have been lowering their prices for seven
to ten days straight, regardless of if the wholesale price
of gasoline has gone up, they continue undercutting their price. Now,
if the whole seal price goes up and a station's
lowering their price, well, how are they able to do that? Well,
essentially they're depleting their own margin. After about seven to
(02:33):
ten days of lowering prices, the replacement cost begins exceeding
their retail price. So essentially what happens is when you
saw prices at two eighty or two ninety yesterday, or
even lower in somes this is two sixty two seventy,
stations are either at or below their replacement cost. And
so what they do with this routine cycle is they're
(02:53):
basically bringing their margin back from nothing up to about
thirty five to forty cents a gallon, and now from
those three twenty nine they'll start lowering again three twenty seven,
twenty five, nineteen fifteen. That'll happen for another seven to
ten days, and then we'll see prices cycle back up again.
And all of it is just a game of margins,
so that stations can always have the lowest price compared
(03:15):
to the competitor.
Speaker 1 (03:16):
Interesting, So it's not just as simple as supply and demand,
and there's I know, there's external factors, you know, geopolitically
and tariffs and all of that and how much. But
it's not just supply and demand. You know, the gas
goes in the tanks underground at one price, and then
you know, the price of oil goes up, well the
gas they've already paid for the gas in the tank.
Speaker 2 (03:38):
Yeah, and you know what instead of seeing a spike,
you know, compared to what station's actually paid, I mean,
stations can pay twenty to thirty cents a gallon more
or less than their competitor. Essentially, what you're doing is
everyone meets in the middle. That is, if a station
got their timing wrong and paid a lot more than
a competitor, the competitors paying much lower price, they meet
in the middle, and instead of having all of these
(04:00):
different prices all over town, that creates a little bit
more uniformity, right, kind of in the middle, one station
maybe taking it on the chin, the other one's doing
it really well. And that just highlights something as well
that it's all about the timing. It's kind of like
going on Amazon, right. The price can change daily one
day at maybe higher or lower, and stations have to
encounter this as well. Oil is a global commodity. It's
(04:21):
changing the wholesal price of gasoline today, by the way,
so far right now this morning, down about two cents
a gallon. So that means stations that fill up later
today will be able to take a little bit lower price,
whereas if station's filled up yesterday, they're going to be
stuck with gasoline that they paid more than the market prices.
Speaker 1 (04:37):
For Big Patrick jahangasbuddy dot com. So we do have
the summer driving season getting underway. I mean we're a
month away from Memorial Day weekend, which is kind of
the unofficial kickoff to all of that, and prices I've
used has said have bounced around a little bit. Do
we expect that to be the story this summer.
Speaker 2 (04:55):
I think so, I think for you know, unless there's
a huge headline change, and I said, there's a lot
that could change ESPUs on those issues Iran, Russia, Ukraine,
US trade war or terris, I should say, and opek,
if one of those things changes amongst those four headlines,
then we could see a different outcome. But I think
for now we're going to be teetering on three dollars
(05:16):
a gown. Some days it's going to be below, and
then when we get a price cycle, it's going to
be back above. So I think where we've been the
last month is where we're going to be most of
the summer. Barring one of those four headlines or a
refinery outitage, we've seen what can happen from those as well.
Speaker 1 (05:31):
Anything on the horizon about gas production domestically, I mean
we hear drill baby drill and using the resources we
have in this country, and we talk about pipelines and
there's on there's politics involved in that, but I mean
it seems like that we've got a lot of availability
here in this country to produce our own energy. Where
do we sit with with all of that and drill
baby drill, Well.
Speaker 2 (05:52):
We're running full till. The problem now is that, through
some of these tariff policies and OPEK raising production, American
producer don't have as much incentive. When oil is sixty
one dollars a barrel. We're actually seeing a big drop
in the rig count. We're still producing record amounts of
crude oil, but what the rig count tells you is
that in the future we may have a problem producing
(06:12):
as much as we are today. Why is that happening
because oil prices are lower. It's just like your boss
asking you to work twice as hard for half as much.
You're going to probably say no thanks. Oil companies are
starting to say no thanks to increasing production at sixty
one dollars a barrel because it's not profitable for them
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