Twin Falls Has a 58 Cent Swing in the Price of Gas

Imagine a 58 cent a gallon price swing for gasoline.  On Thursday afternoon I noticed it while driving home.  Some prices for a gallon of unleaded regular on Kimberly Road were still above 3 dollars.  At Walmart, off North Washington Street, under $2.50.  Just a few blocks south of Walmart I saw a price 42 cents higher.

You may be asking why the wide variety of pricing.

A few thoughts.  One is not all gas is equal.  There are better blends and lower quality grades.  An old friend sold cars for many years and he once told me he put nothing but Exxon-Mobil into his tanks.  He claimed it was a better than most options.  O.K., but probably not anywhere near 40 to 60 cents better.

Gasoline is likely a loss-leader for Walmart.  As I’m leaving after checking out, the pump price is listed above the door.  More than a few times I’ve filled up.  Walmart must also compete with Costco, which also has some of the lowest prices for gasoline.

In the mid-90s I lived in a small town of 6-thousand people.  There were gas stations on each end.  It was a tourist town.  Most visitors entered from the east side.  The price was much higher for the visitors.  On the west side of town the cost was lower.  Many of the people who commuted each day for work came from the west.  When I asked a guy who ran the independent gas station organization in the region about the discrepancy, he explained it was related to the tourists being willing to pay more for a gallon.  They weren’t often familiar with options.  Rarely did they make it to the west end of town.  There weren’t many fancy boutiques and restaurants beyond the center of the community.  In other words, soak the visitors!

My friend, Todd Eccles, believes the prices on Kimberley Road reflect the customer base getting off the highway.  Often, they need to fill up and won’t risk stalling while they look for a bargain.

This happened to me in Montana last summer.  I needed gas.  I needed gas soon!  Very soon!  I found a pump in a small remote town and would’ve paid 5 or 6 bucks a gallon to avoid being stranded on Route 15.  This is how the market works.

By late Friday morning I found no prices above 3 dollars a gallon.