November 1, 2025 • 16 mins
In this episode, host Phil Tower welcomes back to the program one of our favorite guests, Patrick DeHaan, the Head of Petroleum Analysis at GasBuddy.com
Patrick joined us in this segment to discuss a major change in how gasoline is taxed in Michigan.
Michigan's new gas tax system will take effect on January 1, 2026.
The new system will eliminate the 6% sales tax on fuel and replace it with a higher per-gallon state tax, which will rise from the current 31 cents to 51 cents.
Lawmakers in Lansing described it as a "revenue-neutral change" as far as the price impact at the pump; however, Patrick noted that in the long run, most drivers will pay more under the new gas tax system..
Patrick also discussed the dropping price per barrel of oil and what might happen in the new year, especially with the uncertainty looming with tariffs.
Find Patrick Online
GasBuddy.com
Patrick joined us in this segment to discuss a major change in how gasoline is taxed in Michigan.
Michigan's new gas tax system will take effect on January 1, 2026.
The new system will eliminate the 6% sales tax on fuel and replace it with a higher per-gallon state tax, which will rise from the current 31 cents to 51 cents.
Lawmakers in Lansing described it as a "revenue-neutral change" as far as the price impact at the pump; however, Patrick noted that in the long run, most drivers will pay more under the new gas tax system..
Patrick also discussed the dropping price per barrel of oil and what might happen in the new year, especially with the uncertainty looming with tariffs.
Find Patrick Online
GasBuddy.com
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:02):
This is iHeartRadio's West Michigan Weekend. West Michigan Weekend is
a weekly program designed to win form and enlighten on
a wide range of public policy issues, as well as
news and current events. Now here's your host, Phil Tower.
Speaker 2 (00:16):
In this segment. It's a true pleasure to welcome back
to the program. In fact, it's been far too long
since we've had our friend Patrick de'hann on, head of
petroleum analysis at gasbuddy dot com. His website is Patrick
d'hon dot com, and he is on our liveline to
talk about not only oil and gas prices, but a
big change coming up in Michigan with the beginning of
(00:39):
the new year, some new legislation passed in Michigan that
will affect the price at the pump first and foremost. Patrick,
it's good to hear your voice. Welcome back to the program.
Speaker 3 (00:49):
It's going to be with you, Phil, Thanks for having me.
Speaker 2 (00:52):
Yeah. Absolutely, I follow you on Twitter. I guess it's
officially called X right, everybody calls it X at gas
Buddy Guy. Always learned from you. As we're recording this conversation,
get a really interesting tweet. You cover gas and oil
prices across the World EU Court rules unanimously that continuing
(01:15):
to provide and produce fuels essential to modern civilization i e.
Oil does not deprive people of their right to life.
Interesting there was a lawsuit brought by young climate activists
who claimed the country's Arctic oil exploration was putting their
future at risk. That's an interesting ruling by that EU Court.
(01:37):
Fuel has been oil, exploration, gasoline, just all kinds of
fossil fuels patrick have been under attack. It seems like
for the last twenty twenty five years, is that safe
to say?
Speaker 3 (01:50):
Yeah, you know, probably even longer than that. Yeah, but
it's really certainly ramped up in the last fifteen or
twenty years. As you know, keep in mind, these are
the fuels that have powered not only our economy, but
the economies of you know, just about every country that
I can think of, and not just powering the fuels
that drive the economy. But you know, I'm sitting in
(02:12):
front of you, or as I as I talked to you,
sitting in front of me. You know, computers, plastic, monitors,
plastic everywhere, And keep in mind that's all plastic. That
the beauty of how flexible something a material like that
is all is derived from from oil. So a lot
of people demonize oil, but at the same time it's
(02:33):
greatly enhanced every single one of our lives.
Speaker 2 (02:35):
Yeah, I'm so glad you mentioned plastic. Everybody looks at
the the motor vehicle, the truck, the car, the big
as my friend calls them, urban land destroyers, you know,
the big tahoes and expeditions, and these these giant you know,
gas internal combustion engine fueled vehicles. And yet the plastic
(03:01):
around us, which has been a game changer for sixty
seventy years. It's so prevalent and so important. So there
are a lot of reasons we do need at least
fossil fuels for the foreseeable future. Patrick, I'm reading that
oil prices are expected to continue their downward trend because
of a global oversupply. And just like all kinds of
(03:25):
things in the economy and life, there are ebbs and flows.
Why is there a global oversupplies? We're having this conversation.
Speaker 3 (03:32):
Yeah, you know, ebbs and flows. That's you know, supply
and demand. You know, this is basic economics. What has
happened here? Though, It's not just like somebody overnight, you know,
it's not something that, unfortunately, American oil producers can take
credit for. We still are the world's largest oil producer.
By the way, oil production has gone up about one
(03:53):
hundred thousand barrels a day to about thirteen point six
million barrels compared to one year ago. This is something
ever COVID. The US has just been on a mad
tear of increasing oil production, but that may slow down
because OPEK earlier this year decided to abort its policy
that it held for about two years, and OPEK has
(04:14):
been raising production. Now. We've seen these moves from OPEC.
Back in twenty fourteen. I can remember it vividly, watching
the Lions lose on Thanksgiving. But OPEK was busy agreeing
to open this pigot. That's what they said late in
twenty fourteen. And if you can remember back, and a
lot of Americans probably can, I mean, I delve into
gas prison on a daily basis, but that brought such
(04:37):
cheap oil to our pumps. From twenty fifteen through twenty seventeen.
It was I remember going to my grandparents for Thanksgiving
and thinking, holy smokes, it's in twenty fifteen. It's gotten
so much cheaper, so When OPEK makes a policy shift
like this, it obviously has a major impact on global
supply and demand. And OPEK has increased production and that's
(04:57):
why oil prices are now for captay lower in the
next couple of years. We've also seen the Federal Reserve
your remarkable job at slowing the US economy through keeping
interest rates elevated. That is, slowed down consumption, and that's
there the point of the pet holding interest rates hires
to cool the economy off to de rail spending, and
so that has also had a role in limiting oil consumption.
Speaker 2 (05:20):
Yeah, and it certainly, as you said, is cyclical. I
think the thing that frustrates our listeners and just about everybody,
whether you're paying for gas in Michigan or Indiana, or Illinois,
or Minnesota or Florida, is the unpredictable jumps in gas
prices that happen often without warning, although if you've got
(05:42):
the gas Buddy app you can often get a tip
on that. You tip people off to that on your
social media channels. Do we know what causes those unexpected
spikes of thirty to fifty cents and then it drops
back down? Is there any rhyme or reason to that, Patrick, Oh,
there's a lot.
Speaker 3 (05:59):
Of rhyme or reason to it. It's because we live
in a market where it's dominated by you know, a
couple of big retailers and the couple big retailers. The
strategy has been, let's always have the lowest price. But
the problem is you can't always have the lowest price,
right if you continue to undercut your competitor, there's going
(06:20):
to come a point where you can't go any lower.
So when that moment rives, when stations are selling at
costs or sometimes below costs, that's when the cycle then
re resets. That as stations raise their price, they restore
their profit margin from nothing to about forty cents, and
they also pass along any change in the wholesale price
(06:40):
of gasoline since last time. So it was just a
couple of weeks ago that we have the VP refinery
had a fire and price it was Michigan want from
what two fifty two sixty all the way up to
three twenty nine. That's about a big of a jump,
as you see, because the stations had run out of room.
So not only did they raise prices, as I mentioned,
a increase to restore their margin, but the wholesale price
(07:03):
went up twenty five cents because of the fire, So
that's a sixty five cent jump if you couple together
the margin reset and the wholesal cost increase. So you know,
so that's going to continue to happen every couple weeks.
Now it won't be sixty five cents as we get
into the fall, those resets might be up to two
ninety nine and towards Christmas to eighty nine. But those
(07:26):
are going to continue because that's how that's how competition
gets leveraged. They undercut each other. They always want to
have the lowest price. So those cycles of you know,
ups and downs will probably keep continuing.
Speaker 2 (07:37):
Yeah, so the big chains really have an advantage, whether
it's you know, the J and H oil companies or
the speedways you know, very common in Michigan. We've seen
a lot more competition or at least more chains moving
in to the Grand Rapids area. Is that a national
trend where more people are coming in trying to compete
with the bigger guys in regions?
Speaker 3 (07:58):
Yeah, it really is. You know, Ohio just off to
our south the state. I don't like mentioning since I'm
a Michigan fan but Ohio's really been kind of a
crossroads of BUCkies wah wah company's sheets. For those of
you that heard these retailers, I mean they are really
squaring off in areas like Ohio, but even Michigan. The
Up which many Michiganers like to enjoy, faulty. They may
(08:22):
notice that there's a gas station in the up now
called quick Trip in Wisconsin, and quick Trip is coming
into the Up from northern Wisconsin, so there's more competition
up there. In fact, earlier this summer, the cheapest price
in Michigan. We're in the up because this price war,
this turf war that's happening.
Speaker 2 (08:39):
Interesting. We're speaking with Patrick deb Hahn. He is the
head of petroleum analysis at gasbuddy dot com. That's gasbuddy
dot com. Patrick. In our remaining moments, we want to
talk about a big legislative change here in Michigan. And
if you've filled up recently here in the Grand Rapids area,
wherever you're listening to us in Michigan, the price you
(09:00):
paid at the pump head both state and federal taxes,
and that is about to change. Michigan will have a
new gas tax system taking effect January first, and that
legislation was signed into law as we record this episode
about three weeks ago. The state is eliminating the six
percent sales tax on fuel, replacing it with a higher
(09:21):
per gallon state tax, which will bump twenty cents from
thirty one cents to fifty one cents. Now, I gave
you a lot of numbers, but the bottom line is
that at least the lanching lawmakers are going to say,
this is a revenue neutral change. Why did they do
this to have more dedicated funding for roads, bridges, infrastructure
in Michigan. Patrick, you've read about this change that's coming
(09:43):
down the line in Michigan. What are your thoughts on this?
Speaker 3 (09:47):
Well, most states kind of go the opposite direction. Most
states go from a flat, you know, amount per gallon
to a percentage base because you know, well everyone's got
the reasons, but you know, let's not this fill at
the end of the day, this is a tax then
creates that you know, I don't know if I would
say disguised, but that's what it is currently today as
(10:08):
we record this week, here we are fall of twenty
twenty five. The thirty one state thirty one cent state
fuel tax, the six percent tax adds on another thirteen cent,
So arithmetic, that's forty three point three to two excuse me,
forty four point three two cents a gallon, right, So
the state's going to replace this all with a tax
that will be fifty one cents per gallon and fill
(10:31):
with oil prices like that our remain low. As we're
talking about oil price is going to remain low the state.
You know, this is this is going to make prices,
as one representative said, prices will be higher when the
wholesale price is lower. When wholesale prices are higher, gas
prices will be lower. So it's kind of basically, you know,
the state wants kind of guaranteed revenue. So I can
(10:53):
see why the state's doing this. But with oil prices
set to be low the next couple of years, let's
be clear, this is a pretty clear netwind for the
state with taking in more revenue. Now thankfully it's going
to be you know, steered toward the roads instead of
the general fund. But this is a tax increase, and
it's just kind of a formatting shift and set of percentage.
(11:13):
They want to flat them out, right.
Speaker 2 (11:15):
So we could see eight to ten cents on average.
Obviously there's that EBB and flowing there higher gas prices
come January first.
Speaker 3 (11:23):
Yeah, it's definitely going to be an increase. I don't
know if you're going to notice it exactly on January first,
but you may notice it the last week in December
of the first week in January. But yeah, it'll be
a slight sting. It'll probably put us more on par
with Indiana, who has higher than average gas taxes as well.
Speaker 2 (11:40):
You know, the electric vehicles, the evs and the hybrids
don't necessarily play into your world, but they do impact it, certainly.
There's an ancillary impact. Interesting part of that new bill
in Michigan, it takes effect January first. Did you see Patrick,
what they're doing with the registration fees for EV's and as.
Speaker 3 (12:00):
Yeah, I did. I saw that they're boosting that. You know,
and this is the interesting conundrum that you have is,
you know, how do you charge an electric vehicle when
you know the fuel that they fill up with electricity
doesn't is not taxed the same way. So but by
the way, it's still a winner for evs to be
taxed in this way because if you're driving fifteen thousand
miles a year. You know, at current pace, the average,
(12:24):
the average Michigan or pays about four hundred dollars a
year in gasoline taxes and more if you drive a
bigger vehicle like a pickup truck, a minivan or and suv.
So this is putting evs kind of on par with
with what internal combustion engines vehicle pay. Vehicles pay for
gasoline taxes.
Speaker 2 (12:42):
Yeah, it's interesting to note. There's a quote from a
group called the Michigan Energy Innovation Business Council. They said
that bump for evs for the annual registration fees you
pay on your license plate tags makes Michigan the number
one tax highest tax for evs in the state or
in the country. Rather pretty interesting to note, but I'm
(13:03):
so glad you made that comparison with someone who drives
fifteen thousand miles a year, you're still paying four hundred
plus four hundred dollars plus at the tank. That's a
great point to make. Patrick. Have you got a couple
of minutes left? Anything else you see coming down the pipeline?
Pun intended that our listeners need to know about.
Speaker 3 (13:24):
Well, so I think the next couple of months, really,
you know, the year ahead. Gas price is pretty similar
today to compared to where they were a year ago.
So there's a lot of political finger pointing, but what
you're seeing at the pump is still rebalancing of the economy.
After searches that we saw in twenty twenty two, gas
price is slightly lower this year. The victory lap really
(13:45):
belongs to Opek, who's increasing oil production. All in all,
Michigan's average today right about that three dollars gallon mark.
That's seven cents lower than last year, and we should
see plenty of time in the next couple of months.
Most of the winter should be below three dollars a
gallon a good solid majority of the time for the
next few months, and then we'll probably see prices inching
(14:07):
back above the three dollars market next spring in summer.
Speaker 2 (14:10):
With the proviso that that's without any kind of refinery
shutdown or anything else like that, correct.
Speaker 3 (14:18):
Without any major political, geopolitical upsets or any major refinery issues.
There's always some surprises, So that's exactly right. That's that
does not take into consideration the uncertainty that could develop. Right,
nobody's got a crystal ball, and certainly I'm i don't
have one either. Yeah.
Speaker 2 (14:36):
By the way, I don't know if you're seeing this
just a final thing, if you're seeing this more in
Illinois where you are here in Michigan, I'm seeing more
gas stations put in reck fuel of pumps. This is
a head scratcher. Have you noticed that in your area?
Speaker 3 (14:49):
You know, not so much, although there's been some shifts
when you talk about E fifteen and E eighty excuse me,
E eighty five, you know there has been a trend though,
But hey, we're in Michigan. There's a lot of recreational
voters that don't like havingthnol in their gas, and a
lot of those older engines right can't do ethanol. And
that's why you're probably seeing that pop up. Is we
(15:11):
live in a terrific state where boating is a maybe
not year round activity, but that may be why you're
seeing a lot more rec fuel as more voters demandingthanol
free gasoline.
Speaker 2 (15:21):
Yeah, good point, and always we learned something from you,
Patrick de'hon. Always appreciate it. Our friend Patrick dehon, head
of petroleum analysis at gasbuddy dot com. You can also
check him out at patrickdeihon dot com and as always, Patrick,
were grateful for your time. I will mention go Lions
(15:43):
because I know you appreciate that. Go Blue. I'm neutral
in that area as well. The team. Yeah, you know,
I'm neutral on the go Blue, go Green thing because
I'm a Chip. So what can I say? Patrick Dehan?
As always, it's a pleasure.
Speaker 3 (15:56):
Thanks so much, Phil, you too.
Speaker 1 (15:58):
You've been listening to I Heart Radio's West Michigan Weekend.
West Michigan Weekend is a production of Wood Radio and iHeartRadio.
This is iHeartRadio's West Michigan Weekend. West Michigan Weekend is
a weekly program designed to win form and enlighten on
a wide range of public policy issues, as well as
news and current events. Now here's your host, Phil Tower.
Speaker 2 (00:16):
In this segment. It's a true pleasure to welcome back
to the program. In fact, it's been far too long
since we've had our friend Patrick de'hann on, head of
petroleum analysis at gasbuddy dot com. His website is Patrick
d'hon dot com, and he is on our liveline to
talk about not only oil and gas prices, but a
big change coming up in Michigan with the beginning of
(00:39):
the new year, some new legislation passed in Michigan that
will affect the price at the pump first and foremost. Patrick,
it's good to hear your voice. Welcome back to the program.
Speaker 3 (00:49):
It's going to be with you, Phil, Thanks for having me.
Speaker 2 (00:52):
Yeah. Absolutely, I follow you on Twitter. I guess it's
officially called X right, everybody calls it X at gas
Buddy Guy. Always learned from you. As we're recording this conversation,
get a really interesting tweet. You cover gas and oil
prices across the World EU Court rules unanimously that continuing
(01:15):
to provide and produce fuels essential to modern civilization i e.
Oil does not deprive people of their right to life.
Interesting there was a lawsuit brought by young climate activists
who claimed the country's Arctic oil exploration was putting their
future at risk. That's an interesting ruling by that EU Court.
(01:37):
Fuel has been oil, exploration, gasoline, just all kinds of
fossil fuels patrick have been under attack. It seems like
for the last twenty twenty five years, is that safe
to say?
Speaker 3 (01:50):
Yeah, you know, probably even longer than that. Yeah, but
it's really certainly ramped up in the last fifteen or
twenty years. As you know, keep in mind, these are
the fuels that have powered not only our economy, but
the economies of you know, just about every country that
I can think of, and not just powering the fuels
that drive the economy. But you know, I'm sitting in
(02:12):
front of you, or as I as I talked to you,
sitting in front of me. You know, computers, plastic, monitors,
plastic everywhere, And keep in mind that's all plastic. That
the beauty of how flexible something a material like that
is all is derived from from oil. So a lot
of people demonize oil, but at the same time it's
(02:33):
greatly enhanced every single one of our lives.
Speaker 2 (02:35):
Yeah, I'm so glad you mentioned plastic. Everybody looks at
the the motor vehicle, the truck, the car, the big
as my friend calls them, urban land destroyers, you know,
the big tahoes and expeditions, and these these giant you know,
gas internal combustion engine fueled vehicles. And yet the plastic
(03:01):
around us, which has been a game changer for sixty
seventy years. It's so prevalent and so important. So there
are a lot of reasons we do need at least
fossil fuels for the foreseeable future. Patrick, I'm reading that
oil prices are expected to continue their downward trend because
of a global oversupply. And just like all kinds of
(03:25):
things in the economy and life, there are ebbs and flows.
Why is there a global oversupplies? We're having this conversation.
Speaker 3 (03:32):
Yeah, you know, ebbs and flows. That's you know, supply
and demand. You know, this is basic economics. What has
happened here? Though, It's not just like somebody overnight, you know,
it's not something that, unfortunately, American oil producers can take
credit for. We still are the world's largest oil producer.
By the way, oil production has gone up about one
(03:53):
hundred thousand barrels a day to about thirteen point six
million barrels compared to one year ago. This is something
ever COVID. The US has just been on a mad
tear of increasing oil production, but that may slow down
because OPEK earlier this year decided to abort its policy
that it held for about two years, and OPEK has
(04:14):
been raising production. Now. We've seen these moves from OPEC.
Back in twenty fourteen. I can remember it vividly, watching
the Lions lose on Thanksgiving. But OPEK was busy agreeing
to open this pigot. That's what they said late in
twenty fourteen. And if you can remember back, and a
lot of Americans probably can, I mean, I delve into
gas prison on a daily basis, but that brought such
(04:37):
cheap oil to our pumps. From twenty fifteen through twenty seventeen.
It was I remember going to my grandparents for Thanksgiving
and thinking, holy smokes, it's in twenty fifteen. It's gotten
so much cheaper, so When OPEK makes a policy shift
like this, it obviously has a major impact on global
supply and demand. And OPEK has increased production and that's
(04:57):
why oil prices are now for captay lower in the
next couple of years. We've also seen the Federal Reserve
your remarkable job at slowing the US economy through keeping
interest rates elevated. That is, slowed down consumption, and that's
there the point of the pet holding interest rates hires
to cool the economy off to de rail spending, and
so that has also had a role in limiting oil consumption.
Speaker 2 (05:20):
Yeah, and it certainly, as you said, is cyclical. I
think the thing that frustrates our listeners and just about everybody,
whether you're paying for gas in Michigan or Indiana, or Illinois,
or Minnesota or Florida, is the unpredictable jumps in gas
prices that happen often without warning, although if you've got
(05:42):
the gas Buddy app you can often get a tip
on that. You tip people off to that on your
social media channels. Do we know what causes those unexpected
spikes of thirty to fifty cents and then it drops
back down? Is there any rhyme or reason to that, Patrick, Oh,
there's a lot.
Speaker 3 (05:59):
Of rhyme or reason to it. It's because we live
in a market where it's dominated by you know, a
couple of big retailers and the couple big retailers. The
strategy has been, let's always have the lowest price. But
the problem is you can't always have the lowest price,
right if you continue to undercut your competitor, there's going
(06:20):
to come a point where you can't go any lower.
So when that moment rives, when stations are selling at
costs or sometimes below costs, that's when the cycle then
re resets. That as stations raise their price, they restore
their profit margin from nothing to about forty cents, and
they also pass along any change in the wholesale price
(06:40):
of gasoline since last time. So it was just a
couple of weeks ago that we have the VP refinery
had a fire and price it was Michigan want from
what two fifty two sixty all the way up to
three twenty nine. That's about a big of a jump,
as you see, because the stations had run out of room.
So not only did they raise prices, as I mentioned,
a increase to restore their margin, but the wholesale price
(07:03):
went up twenty five cents because of the fire, So
that's a sixty five cent jump if you couple together
the margin reset and the wholesal cost increase. So you know,
so that's going to continue to happen every couple weeks.
Now it won't be sixty five cents as we get
into the fall, those resets might be up to two
ninety nine and towards Christmas to eighty nine. But those
(07:26):
are going to continue because that's how that's how competition
gets leveraged. They undercut each other. They always want to
have the lowest price. So those cycles of you know,
ups and downs will probably keep continuing.
Speaker 2 (07:37):
Yeah, so the big chains really have an advantage, whether
it's you know, the J and H oil companies or
the speedways you know, very common in Michigan. We've seen
a lot more competition or at least more chains moving
in to the Grand Rapids area. Is that a national
trend where more people are coming in trying to compete
with the bigger guys in regions?
Speaker 3 (07:58):
Yeah, it really is. You know, Ohio just off to
our south the state. I don't like mentioning since I'm
a Michigan fan but Ohio's really been kind of a
crossroads of BUCkies wah wah company's sheets. For those of
you that heard these retailers, I mean they are really
squaring off in areas like Ohio, but even Michigan. The
Up which many Michiganers like to enjoy, faulty. They may
(08:22):
notice that there's a gas station in the up now
called quick Trip in Wisconsin, and quick Trip is coming
into the Up from northern Wisconsin, so there's more competition
up there. In fact, earlier this summer, the cheapest price
in Michigan. We're in the up because this price war,
this turf war that's happening.
Speaker 2 (08:39):
Interesting. We're speaking with Patrick deb Hahn. He is the
head of petroleum analysis at gasbuddy dot com. That's gasbuddy
dot com. Patrick. In our remaining moments, we want to
talk about a big legislative change here in Michigan. And
if you've filled up recently here in the Grand Rapids area,
wherever you're listening to us in Michigan, the price you
(09:00):
paid at the pump head both state and federal taxes,
and that is about to change. Michigan will have a
new gas tax system taking effect January first, and that
legislation was signed into law as we record this episode
about three weeks ago. The state is eliminating the six
percent sales tax on fuel, replacing it with a higher
(09:21):
per gallon state tax, which will bump twenty cents from
thirty one cents to fifty one cents. Now, I gave
you a lot of numbers, but the bottom line is
that at least the lanching lawmakers are going to say,
this is a revenue neutral change. Why did they do
this to have more dedicated funding for roads, bridges, infrastructure
in Michigan. Patrick, you've read about this change that's coming
(09:43):
down the line in Michigan. What are your thoughts on this?
Speaker 3 (09:47):
Well, most states kind of go the opposite direction. Most
states go from a flat, you know, amount per gallon
to a percentage base because you know, well everyone's got
the reasons, but you know, let's not this fill at
the end of the day, this is a tax then
creates that you know, I don't know if I would
say disguised, but that's what it is currently today as
(10:08):
we record this week, here we are fall of twenty
twenty five. The thirty one state thirty one cent state
fuel tax, the six percent tax adds on another thirteen cent,
So arithmetic, that's forty three point three to two excuse me,
forty four point three two cents a gallon, right, So
the state's going to replace this all with a tax
that will be fifty one cents per gallon and fill
(10:31):
with oil prices like that our remain low. As we're
talking about oil price is going to remain low the state.
You know, this is this is going to make prices,
as one representative said, prices will be higher when the
wholesale price is lower. When wholesale prices are higher, gas
prices will be lower. So it's kind of basically, you know,
the state wants kind of guaranteed revenue. So I can
(10:53):
see why the state's doing this. But with oil prices
set to be low the next couple of years, let's
be clear, this is a pretty clear netwind for the
state with taking in more revenue. Now thankfully it's going
to be you know, steered toward the roads instead of
the general fund. But this is a tax increase, and
it's just kind of a formatting shift and set of percentage.
(11:13):
They want to flat them out, right.
Speaker 2 (11:15):
So we could see eight to ten cents on average.
Obviously there's that EBB and flowing there higher gas prices
come January first.
Speaker 3 (11:23):
Yeah, it's definitely going to be an increase. I don't
know if you're going to notice it exactly on January first,
but you may notice it the last week in December
of the first week in January. But yeah, it'll be
a slight sting. It'll probably put us more on par
with Indiana, who has higher than average gas taxes as well.
Speaker 2 (11:40):
You know, the electric vehicles, the evs and the hybrids
don't necessarily play into your world, but they do impact it, certainly.
There's an ancillary impact. Interesting part of that new bill
in Michigan, it takes effect January first. Did you see Patrick,
what they're doing with the registration fees for EV's and as.
Speaker 3 (12:00):
Yeah, I did. I saw that they're boosting that. You know,
and this is the interesting conundrum that you have is,
you know, how do you charge an electric vehicle when
you know the fuel that they fill up with electricity
doesn't is not taxed the same way. So but by
the way, it's still a winner for evs to be
taxed in this way because if you're driving fifteen thousand
miles a year. You know, at current pace, the average,
(12:24):
the average Michigan or pays about four hundred dollars a
year in gasoline taxes and more if you drive a
bigger vehicle like a pickup truck, a minivan or and suv.
So this is putting evs kind of on par with
with what internal combustion engines vehicle pay. Vehicles pay for
gasoline taxes.
Speaker 2 (12:42):
Yeah, it's interesting to note. There's a quote from a
group called the Michigan Energy Innovation Business Council. They said
that bump for evs for the annual registration fees you
pay on your license plate tags makes Michigan the number
one tax highest tax for evs in the state or
in the country. Rather pretty interesting to note, but I'm
(13:03):
so glad you made that comparison with someone who drives
fifteen thousand miles a year, you're still paying four hundred
plus four hundred dollars plus at the tank. That's a
great point to make. Patrick. Have you got a couple
of minutes left? Anything else you see coming down the pipeline?
Pun intended that our listeners need to know about.
Speaker 3 (13:24):
Well, so I think the next couple of months, really,
you know, the year ahead. Gas price is pretty similar
today to compared to where they were a year ago.
So there's a lot of political finger pointing, but what
you're seeing at the pump is still rebalancing of the economy.
After searches that we saw in twenty twenty two, gas
price is slightly lower this year. The victory lap really
(13:45):
belongs to Opek, who's increasing oil production. All in all,
Michigan's average today right about that three dollars gallon mark.
That's seven cents lower than last year, and we should
see plenty of time in the next couple of months.
Most of the winter should be below three dollars a
gallon a good solid majority of the time for the
next few months, and then we'll probably see prices inching
(14:07):
back above the three dollars market next spring in summer.
Speaker 2 (14:10):
With the proviso that that's without any kind of refinery
shutdown or anything else like that, correct.
Speaker 3 (14:18):
Without any major political, geopolitical upsets or any major refinery issues.
There's always some surprises, So that's exactly right. That's that
does not take into consideration the uncertainty that could develop. Right,
nobody's got a crystal ball, and certainly I'm i don't
have one either. Yeah.
Speaker 2 (14:36):
By the way, I don't know if you're seeing this
just a final thing, if you're seeing this more in
Illinois where you are here in Michigan, I'm seeing more
gas stations put in reck fuel of pumps. This is
a head scratcher. Have you noticed that in your area?
Speaker 3 (14:49):
You know, not so much, although there's been some shifts
when you talk about E fifteen and E eighty excuse me,
E eighty five, you know there has been a trend though,
But hey, we're in Michigan. There's a lot of recreational
voters that don't like havingthnol in their gas, and a
lot of those older engines right can't do ethanol. And
that's why you're probably seeing that pop up. Is we
(15:11):
live in a terrific state where boating is a maybe
not year round activity, but that may be why you're
seeing a lot more rec fuel as more voters demandingthanol
free gasoline.
Speaker 2 (15:21):
Yeah, good point, and always we learned something from you,
Patrick de'hon. Always appreciate it. Our friend Patrick dehon, head
of petroleum analysis at gasbuddy dot com. You can also
check him out at patrickdeihon dot com and as always, Patrick,
were grateful for your time. I will mention go Lions
(15:43):
because I know you appreciate that. Go Blue. I'm neutral
in that area as well. The team. Yeah, you know,
I'm neutral on the go Blue, go Green thing because
I'm a Chip. So what can I say? Patrick Dehan?
As always, it's a pleasure.
Speaker 3 (15:56):
Thanks so much, Phil, you too.
Speaker 1 (15:58):
You've been listening to I Heart Radio's West Michigan Weekend.
West Michigan Weekend is a production of Wood Radio and iHeartRadio.
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