Easy Money!! Exploit the difference in gas prices!

[Filliam H. Muffman]

The real way to make money is to come up with a way to buy it wholesale and sell it to people without them having to pay taxes at all, but that is even more illegal.

You also have to take into account that some states are required to sell fuel with oxygenate (usually ethanol).

[Seacrest]

[quote The UnDoug]I've thought it through a number of times, myself. Here in Philadelphia, even at the cheapest stations (and there can be a 20 cent or more difference between stations within a mile or two of each other), the price is still about 30 cents more than it is in New Jersey, right across the bridge over the Delaware River. It'd only take a few minutes to drive to Jersey and get fill up, *but*, there's a three dollar toll to cross the bridge back to Philadelphia. So for my car's 16 gallon tank, I figure it'd have to be at least a thirty cent difference (about $4.80 total difference) to cover the toll and my time. :-)
The Tacony-Palmyra bridge is only $2.
Depending where you live, it might be farther away though.
Also, you can cross over to Jersey for free on I-95 North near Trenton.
Probably doesn't make economic sense, though.

[mjgkramer]

[quote Filliam H. Muffman]The real way to make money is to come up with a way to buy it wholesale and sell it to people without them having to pay taxes at all, but that is even more illegal.
You could pull that off with no repercussions to you if they swear that they are buying it for farm or off road use.

[Grateful11]

<$1.30 a gallon wholesale?

http://www.bloomberg.com/energy/

[Baby Tats]

[quote MacMagus]It didn't take long for me to realize that there's more than just saving money on the line. This could be a profitable enterprise for the right person.
There is probably a difference in the local taxes paid. Not that this would account for the entire difference.

You do understand that people are already doing this as a profitable enterprise right? They are called gas station owners. They are buying cheaper gas, moving it, marking it up, and selling it at a profit. It is just that they pay the truck drivers to haul it for them.

The economics of gasoline are unusual as the demand is inelastic and the supply is near constant and effectively has a cap. Are you buying more gas now that it is cheaper? Much of the flucuation in price is due to speculative trading of wholesale gas. There are a lot of traders losing a bunch of money right now as they speculated a higher wholesale cost many months ago. In essence, they are obligated to buy that gas at the agreed upon price and resell it now for less. You can't really take posession of the gas and resell it in the future when/if the price goes up although it is theoretically possible. And although it has never been proven, I believe that there is collusion within the refining industry. We know that there is collusion on the part of the crude suppliers (OPEC).

I wish there were nationwide gas banks that would allow you to purchase gas in bulk and deposit it into a tank for a fee. Then you could withdraw that gas into the future until it was gone. I have heard of one but it is local only. http://www.fuelbank.com/ is supposed to go live nationwide this fall. http://www.firstfuelbank.com/ is local to the St. Cloud, MN area only.


BT

[Carnos Jax]

[quote Grateful11]Remember they're only making 3-4¢ per gallon on gas at the station. They still lay claim to
this nonsense. I've heard them actually say this in the papers and on TV news. So I guess
the guy 30 miles away from my house selling it 30¢ a gallon is losing money, right.
From what I understand, for most privately owned (as opposed to oil company and gas distributor owned) stations, the gas part of it is a loss operation. Regular gas for sure is (they only make a penny or two) when you take into account pump repairs/upgrades and other tank maintenance. Premium costs about as much as regular, and so the stations make the most money here (about 15 cents or more, that is why you'll see some stations run Premium for the price of Regular days).

I've actually looked at the books and distributor invoices (my dad recently bought a Texaco station in Carrollton, Texas...northern suburb of Dallas). Before, I thought what a racket these gas stations and oil companies have.

Gas stations have to sign long term supply contracts. The prices (from what I understand) aren't fixed in the contract. They're set by oil companies for a particular market (the stations communicate with the oil company daily to determine that days market price). So, many times the station will buy gas at one price, then if it goes down, they'll take a loss on that shipment (the converse is true as well).

This is one reason why items in convenience stores cost so much. But where most gas stations make their money is alcohol and cigarette sales. This actually makes such businesses very lucrative.

[SteveO]

What Carnos said. As for discrepancies in price among areas in close proximity: monopolies (whether owned by Exxon-Mobil or Joe Private Gas Station owner who has a bunch of stations concentrated in an area) aren't in biz to serve the consumer.

[Racer X]

[quote MacMagus]Stirring the pot a little bit: I just saw a tv news blurb about a price war between gas stations that got the price below $2 dollars a gallon. One of the station managers admitted that he's paying less than $1.30 per gallon PREMIUM so he's still making good money.

Nice profit margins.
The problem with your reasoning is that he pays 1.30 a gallon, and then he has to tack on the 50 cents or more in taxes he has to collect and pass on to the government, so his profit is far less than you claim.

[chas_m]

[quote MacMagus]Gas costs $2.46 for regular near DC.

It costs $2.02 just 90 miles south near Richmond.
DC = solid Blue.
Richmond = pretty darn Red.

Figure it out. Election time is near.

[Racer X]

same in Washington. Normally, eastern Washington and the outlying areas in Western Washington have cheaper gas than the Seattle/Tacoma and Everett.

But with the elections coming up, it has flipped. Since a huge majority of the voters are clustered around Puget Sound, we now have the cheap gas.