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NFT: Musings on the price of gas

Marty in Albany : 1/26/2021 2:12 pm
If I told you that I just paid $2.43 for gas I would be lying. Actually, I paid $2.439 or $2.43 and 9/10 cents per gallon. With the 9/10 part written in smaller numerals on the gas station’s sign than the $2.43 part. You get the same deal at your gas station. Does that bother you?

Is there any other product that we buy that adds an extra 9/10 of a cent to the price of each item?

It’s the greedy oil company’s way of charging you almost $2.44, but making it look like they’re giving you a bargain price of $2.43. It’s their sneakiness, and their assumption that you are too dumb to figure out what they are doing that bothers me.

Once upon a time (the 1960s), when I lived in Queens, I used to go to the Merry Twins gas station in Fresh Meadows. In those days I paid about 30 cents a gallon. Actually, it would have been 30 and 9/10 cents per gallon. It was the same then as it now, but at least in those days it made more sense. Adding 9/10 cents to 30 cents adds a 3% profit to each sale. That’s good marketing.

I didn’t mind it then. When I bought gas at Merry Twins, (and most other places) they popped the hood and checked my oil and wiped off my windshield without even being asked. Then they asked me what grade of gas I wanted and filled my tank for me. If I asked for it, they would also check my tire pressure, or give me a free road map if I needed directions. That kind of service is about as common now as doctors making house calls.

Adding 9/10 cents to the current gas price of $2.43 increases the oil company’s profit by only .037%, or a little over 1/3 of one percent. Come on! How greedy (and insulting) can you get?!

I read an article about a decade ago  
KDavies : 1/26/2021 2:22 pm : link
that oil companies made about 7 cents profit on a gallon of gas, while the government made an average of 48 cent profit on a gallon of gas. The profit margins on oil companies is really not that high.
It isn't greed, it's the fact that people will literally price shop  
Zeke's Alibi : 1/26/2021 2:23 pm : link
gasoline to the cent, so one place started doing it, and they all followed suit. There's plenty of people out there that make a big deal about the price of gas when they can easily afford the dollar or more it costs to fill their tank. My dad was always one of these people which blew my mind. He isn't alone in this.
Even more amazing...  
BamaBlue : 1/26/2021 2:27 pm : link
is that milk is more expensive than gasoline. When you consider what it takes to bring a gallon of gasoline to market versus a gallon of milk, it leaves you scratching your head.
prices have always had 9/10  
Alan W : 1/26/2021 2:38 pm : link
as in always
RE: Even more amazing...  
Big Blue Blogger : 1/26/2021 2:42 pm : link
BamaBlue said:
Quote:
is that milk is more expensive than gasoline. When you consider what it takes to bring a gallon of gasoline to market versus a gallon of milk, it leaves you scratching your head.
OTOH, you don't have to feed a dead dinosaur. And petroleum doesn't spoil. It doesn't even need refrigeration.

Marty: If the pricing conventions bother you that much, buy an electric car. Then you can complain about opaque kilowatt pricing. ;o)
Marty  
robbieballs2003 : 1/26/2021 2:42 pm : link
This is a ridiculous post. Most gas stations are owned by individuals who basically are using the name of big oil companies. The individuals sell the price for what they want. This isn't mandated by the big oil companies.
Insulted by the 9/10  
He's Not Here : 1/26/2021 2:43 pm : link
But no comment on the 70 cents per gallon that the government takes at the pump.

An average Quick Chek/Wawa pumps around 3-4 million gallons a year. That sends over 2 million a year to the government PER location.
RE: Even more amazing...  
KDavies : 1/26/2021 2:45 pm : link
In comment 15134972 BamaBlue said:
Quote:
is that milk is more expensive than gasoline. When you consider what it takes to bring a gallon of gasoline to market versus a gallon of milk, it leaves you scratching your head.


Diary farming is even less profitable.
What bothers me more  
Mike in NY : 1/26/2021 2:46 pm : link
Gas stations that charge different prices for Cash or Credit yet post only the Cash price on their exterior signage. The only way you know the difference is once you get to the pump or notice the relatively small "cash" notation on the sign.
Mike  
He's Not Here : 1/26/2021 2:47 pm : link
That is against the law in NJ. Guess it flys in NY though
RE: Insulted by the 9/10  
KDavies : 1/26/2021 2:49 pm : link
In comment 15134983 He's Not Here said:
Quote:
But no comment on the 70 cents per gallon that the government takes at the pump.

An average Quick Chek/Wawa pumps around 3-4 million gallons a year. That sends over 2 million a year to the government PER location.


Right? In California, it is over 80 cents a gallon in state and federal taxes. But people are worried about less than a cent a gallon?
Link - ( New Window )
RE: Mike  
Mike in NY : 1/26/2021 2:50 pm : link
In comment 15134991 He's Not Here said:
Quote:
That is against the law in NJ. Guess it flys in NY though


They display both prices on the pumps themselves, but the exterior sign that you can see from the road listing the prices does not always list both prices. Not to mention there is no consistency in the mark-up for credit. Prior to a crackdown, most stations charged a $0.10-$0.20 premium for credit except for one station by me that charged a spread of ~$0.70.
I am more concerned with the tax on gas  
PA Aggie : 1/26/2021 2:51 pm : link
Whether something is 9/10 of a cent added on doesn't enter my mind...but when my wonderful state of PA is at almost $0.59 per gallon tax, second in the nation behind CA, and our roads are garbage...that bothers me.

Nearby, NJ highways are stellar compared to PA's. NJ is at $0.51 tax per gallon. And we in PA pay about $0.20-0.25 per gallon more at the pump. I have no idea where the money goes?

Some complain in PA that we are more expensive while pumping our own...for me, I love it. In and out in minutes. Wife hates it. I don't have to wait for the attendant to get to me when he/she notices I have been sitting for 5 minutes. The one good thing about PA gas, you can fairly easily find ethanol free gas for your mowers and garden equipment.
In NJ you can't  
He's Not Here : 1/26/2021 2:53 pm : link
post just your Cash price on the road sign. You have to list both your cash and credit price.

the 9/10 had something to do  
section125 : 1/26/2021 2:54 pm : link
with attendants cheating on the price way back when gas stations first opened.


PA  
He's Not Here : 1/26/2021 2:58 pm : link
Those are older figures.

The PA/NJ spread is now around 8 cents on tax.

NJ would see their price come down 10-15 per gallon if they ever allow self serve.
RE: I am more concerned with the tax on gas  
Sec 103 : 1/26/2021 3:01 pm : link
In comment 15135001 PA Aggie said:
Quote:
Whether something is 9/10 of a cent added on doesn't enter my mind...but when my wonderful state of PA is at almost $0.59 per gallon tax, second in the nation behind CA, and our roads are garbage...that bothers me.

Nearby, NJ highways are stellar compared to PA's. NJ is at $0.51 tax per gallon. And we in PA pay about $0.20-0.25 per gallon more at the pump. I have no idea where the money goes?

Some complain in PA that we are more expensive while pumping our own...for me, I love it. In and out in minutes. Wife hates it. I don't have to wait for the attendant to get to me when he/she notices I have been sitting for 5 minutes. The one good thing about PA gas, you can fairly easily find ethanol free gas for your mowers and garden equipment.


Stellar roads in Jersey, surely you jest.....
And the taxes have been raised over 33 cents a gallons the last two years.
The NJ tax  
He's Not Here : 1/26/2021 3:08 pm : link
is now tied to the transportation budget. If gas tax revenues fall because people drive less(Covid), the tax goes up in October.

As electric vehicles takes a greater share of the miles driven, the gas tax will have to keep going up and up until they figure out how they are going to get money from the electric cars.

Most bottled water costs more per gallon  
Peter from NH (formerly CT) : 1/26/2021 3:38 pm : link
than gas. I am amazed that the energy companies can find it, get it 1000s of feet out of the ground, refine it and make it available everywhere. Water literally falls out of the sky.
RE: PA  
BigBlueShock : 1/26/2021 3:48 pm : link
In comment 15135010 He's Not Here said:
Quote:
Those are older figures.

The PA/NJ spread is now around 8 cents on tax.

NJ would see their price come down 10-15 per gallon if they ever allow self serve.

Those gas station attendants in NJ take their jobs seriously. Those dudes are insane. I was traveling through NJ one time a few years ago and completely forgot that they had all full service. Out of habit I pull up to the pump, get out and start pumping. This raging lunatic comes running out of nowhere freaking the hell out. I thought he was going to stab me. I tried explaining to him that it was a mistake but he didn’t want to hear any part of it. A coworker of mine said the same thing happened to him once and the guy told him if he ever came back he’d slash his tires. Good grief, man. Get a grip people.
Looking back on gas stations of yesteryear  
M.S. : 1/26/2021 4:35 pm : link

Does anyone remember the Sinclair Gas Stations with the Green Dinosaur?
8/10ths?  
santacruzom : 1/26/2021 4:46 pm : link
Donny's Discount Gas!
Donny's Discount Gas - ( New Window )
RE: RE: PA  
Del Shofner : 1/26/2021 4:51 pm : link
In comment 15135068 BigBlueShock said:
Quote:
NJ would see their price come down 10-15 per gallon if they ever allow self serve.


Those gas station attendants in NJ take their jobs seriously. Those dudes are insane. I was traveling through NJ one time a few years ago and completely forgot that they had all full service. Out of habit I pull up to the pump, get out and start pumping. This raging lunatic comes running out of nowhere freaking the hell out. I thought he was going to stab me. I tried explaining to him that it was a mistake but he didn’t want to hear any part of it. A coworker of mine said the same thing happened to him once and the guy told him if he ever came back he’d slash his tires. Good grief, man. Get a grip people.


What is the thinking in NJ behind requiring all full service? Job creation over gas prices (and the fact that a lot of people, including me, prefer to pump their own gas)? I can't see why it's still a thing.
RE: RE: RE: PA  
section125 : 1/26/2021 5:31 pm : link
In comment 15135115 Del Shofner said:
Quote:
In comment 15135068 BigBlueShock said:


Quote:


NJ would see their price come down 10-15 per gallon if they ever allow self serve.


Those gas station attendants in NJ take their jobs seriously. Those dudes are insane. I was traveling through NJ one time a few years ago and completely forgot that they had all full service. Out of habit I pull up to the pump, get out and start pumping. This raging lunatic comes running out of nowhere freaking the hell out. I thought he was going to stab me. I tried explaining to him that it was a mistake but he didn’t want to hear any part of it. A coworker of mine said the same thing happened to him once and the guy told him if he ever came back he’d slash his tires. Good grief, man. Get a grip people.



What is the thinking in NJ behind requiring all full service? Job creation over gas prices (and the fact that a lot of people, including me, prefer to pump their own gas)? I can't see why it's still a thing.


Safety
RE: RE: RE: RE: PA  
GIANTS128 : 1/26/2021 5:38 pm : link
In comment 15135140 section125 said:
Quote:
In comment 15135115 Del Shofner said:


Quote:


In comment 15135068 BigBlueShock said:


Quote:


NJ would see their price come down 10-15 per gallon if they ever allow self serve.


Those gas station attendants in NJ take their jobs seriously. Those dudes are insane. I was traveling through NJ one time a few years ago and completely forgot that they had all full service. Out of habit I pull up to the pump, get out and start pumping. This raging lunatic comes running out of nowhere freaking the hell out. I thought he was going to stab me. I tried explaining to him that it was a mistake but he didn’t want to hear any part of it. A coworker of mine said the same thing happened to him once and the guy told him if he ever came back he’d slash his tires. Good grief, man. Get a grip people.



What is the thinking in NJ behind requiring all full service? Job creation over gas prices (and the fact that a lot of people, including me, prefer to pump their own gas)? I can't see why it's still a thing.



Safety


Are you serious or just joking....never have I seen the headline"inexperienced person pumps own gas and loses life"

The rest of the country does it

Section  
He's Not Here : 1/26/2021 5:54 pm : link
That is the reason the State pointed to when defending its constitutionality in court. They argued the right to regulate it because of the hazardous nature(diesel can be self serve in Jersey because of its differing flash point).

The real reason it was initially banned was a concerted lobbying effort from the NJ Gasoline retailers. They were afraid self serve would allow big oil to run stations without the franchisee, or open their own competing stations and drive them out of business.

Ironically, the same group is now lobbying to have the law taken off the books.



RE: RE: PA  
Jim in Fairfax : 1/26/2021 6:08 pm : link
In comment 15135068 BigBlueShock said:
Quote:

Those gas station attendants in NJ take their jobs seriously. Those dudes are insane. I was traveling through NJ one time a few years ago and completely forgot that they had all full service. Out of habit I pull up to the pump, get out and start pumping. This raging lunatic comes running out of nowhere freaking the hell out. I thought he was going to stab me. I tried explaining to him that it was a mistake but he didn’t want to hear any part of it. A coworker of mine said the same thing happened to him once and the guy told him if he ever came back he’d slash his tires. Good grief, man. Get a grip people.

There’s a very practical reason they do this: The station can get slapped with serious fines if the cops catch customers pumping gas. You’d freak about it too after you’d been whacked with the fines.
RE: RE: Even more amazing...  
BMac : 1/26/2021 6:12 pm : link
In comment 15134989 KDavies said:
Quote:
In comment 15134972 BamaBlue said:


Quote:


is that milk is more expensive than gasoline. When you consider what it takes to bring a gallon of gasoline to market versus a gallon of milk, it leaves you scratching your head.



Diary farming is even less profitable.


Do peole even keep diarys anymore?
RE: Most bottled water costs more per gallon  
BMac : 1/26/2021 6:16 pm : link
In comment 15135056 Peter from NH (formerly CT) said:
Quote:
than gas. I am amazed that the energy companies can find it, get it 1000s of feet out of the ground, refine it and make it available everywhere. Water literally falls out of the sky.


Not bottled water. That gets pumped from puddles behind the Port-O-Potties.
Definitely  
Bill in UT : 1/26/2021 6:29 pm : link
a First World problem
RE: RE: Most bottled water costs more per gallon  
Matt M. : 1/26/2021 7:05 pm : link
In comment 15135187 BMac said:
Quote:
In comment 15135056 Peter from NH (formerly CT) said:


Quote:


than gas. I am amazed that the energy companies can find it, get it 1000s of feet out of the ground, refine it and make it available everywhere. Water literally falls out of the sky.



Not bottled water. That gets pumped from puddles behind the Port-O-Potties.
I read an article about a year ago about Poland Spring. Nestle has been involved in an ongoing lawsuit about their advertising. Essentially the claims are that the water is no actually from a natural spring, the original Poland Spring dried up about 50 years ago, and the manmade springs they created were alleged to be but up against human waste sites.
An optimist would see that as saving 1/10 th  
Sneakers O'toole : 1/26/2021 8:43 pm : link
of a penny per gallon.
RE: I am more concerned with the tax on gas  
jdf : 1/26/2021 10:06 pm : link
In comment 15135001 PA Aggie said:
Quote:
Whether something is 9/10 of a cent added on doesn't enter my mind...but when my wonderful state of PA is at almost $0.59 per gallon tax, second in the nation behind CA, and our roads are garbage...that bothers me.

Nearby, NJ highways are stellar compared to PA's. NJ is at $0.51 tax per gallon. And we in PA pay about $0.20-0.25 per gallon more at the pump. I have no idea where the money goes?

Some complain in PA that we are more expensive while pumping our own...for me, I love it. In and out in minutes. Wife hates it. I don't have to wait for the attendant to get to me when he/she notices I have been sitting for 5 minutes. The one good thing about PA gas, you can fairly easily find ethanol free gas for your mowers and garden equipment.


The taxes on gasoline don't come close to paying the full costs that come from the pollution that is caused by burning it and the damage caused by mining and producing it.

In fact, the US subsidizes the true cost of fuels by a massive amount -- around $649 billion in the year 2017 alone, according to an IMF study. Globally, governments subsidize fossils fuels at a rate of around $5.2 trillion per year.
Forbes: US Spends 10 times More on Fossil Fuel Subsidies Than Education - ( New Window )
Seriously?  
SMitch-56 : 1/26/2021 10:12 pm : link
The whole premise of this post is wrong and apparently, unless I missed it, no one bothered a simple Google. The 9/10s is a TAX.
Link - ( New Window )
It’s a relic of a tax...  
trueblueinpw : 1/26/2021 11:07 pm : link
I don’t think anyone is still taxing at 9/10 of a penny.
About that 9/10 gas price - ( New Window )
RE: PA  
PA Aggie : 1/27/2021 7:21 am : link
In comment 15135010 He's Not Here said:
Quote:
Those are older figures.

The PA/NJ spread is now around 8 cents on tax.

NJ would see their price come down 10-15 per gallon if they ever allow self serve.


My post said Pa was $0.59. NJ was $0.51....
RE: RE: I am more concerned with the tax on gas  
PA Aggie : 1/27/2021 7:25 am : link
In comment 15135016 Sec 103 said:
Quote:
In comment 15135001 PA Aggie said:


Quote:


Whether something is 9/10 of a cent added on doesn't enter my mind...but when my wonderful state of PA is at almost $0.59 per gallon tax, second in the nation behind CA, and our roads are garbage...that bothers me.

Nearby, NJ highways are stellar compared to PA's. NJ is at $0.51 tax per gallon. And we in PA pay about $0.20-0.25 per gallon more at the pump. I have no idea where the money goes?

Some complain in PA that we are more expensive while pumping our own...for me, I love it. In and out in minutes. Wife hates it. I don't have to wait for the attendant to get to me when he/she notices I have been sitting for 5 minutes. The one good thing about PA gas, you can fairly easily find ethanol free gas for your mowers and garden equipment.



Stellar roads in Jersey, surely you jest.....
And the taxes have been raised over 33 cents a gallons the last two years.


I stated in my post, "NJ roads are stellar compared to PA". While NJ roads may not be great compared to other states, they far outshine PA's.
I work for a wholesale gas distributor as an Analyst.  
BigBlue2112 : 1/27/2021 9:12 am : link
we own/operate/distribute to 2,300+ stations across the country. There is so much market research on the power of numbers when setting prices. Which numbers look more attractive to the consumer etc. For an example- a consumer is exponentially more likely to purchase gas at $2.99/gallon than $3.00/gallon. holds true for all 9's and 0's. We have an entire pricing team that utilizes all kinds of strategies like that.

Our company is responsible for 2+ Billions gallons of fuel per year. by pricing up at $2.999/gallon instead of $2.990/ gallon we're looking at an extra $18,000,000. That's significant when our average margin per gallon is ~$0.04.
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