Gas Station Owners Aren’t Passing Their Savings On To Consumers

(mightynine)

You may have noticed prices gradually falling at your neighborhood gas station over the last few months, what you may not know is that the price of oil has been falling even faster than that. Why aren’t station owners passing the savings on to drivers? They’re in a generally low-margin business, and we’re all still buying gas anyway.

Gas costs about a dollar less nationwide right now than it did a year ago, which is putting more money in consumers’ pockets for other things, and making drivers more cheerful in general. The problem is, while that’s a nice decrease, oil prices are down about 40% since earlier this year. The price that we pay for gasoline hasn’t kept up with that. During that same period, investment bank Goldman Sachs estimates that gas stations’ profit margins are 18.5% higher than they were at the same time last year.

Oil prices worldwide have been falling because oil production is up

Gas stations have been slow to pass along fuel savings [MarketWatch]

Consumers raking in $125 billion windfall from cheap gas [MarketWatch]

by Laura Northrup via Consumerist