LACONIA — Three of the 10 filling stations in the city reporting to the Gas Buddy website, which closely monitors fuel prices in the United States and Canada, are selling regular unleaded gasoline for less than $2 a gallon for the first time in nearly six years.
Yesterday Oasis Gas and Mini Market at the foot of Prescott Hill and Premium Mart on Court Street posted the lowest price of $1.97 per gallon, followed closely by Shop Express at the corner of Union Avenue and Gilford Avenue. Prices at eight of the 10 stations were below the average price in New Hampshire of $2.20 per gallon, 10 cents above the national average. Prices are also below $2 per gallon at the Irving stations in Belmont and Tilton and at the Citgo station at the Airport Country Store & Deli in Gilford.
In the past year the average price of gasoline in the state has fallen $1.20, from $3.40 to $2.20 per gallon, or by more than a third. In the last month , and has dropped n 50 cents per gallon in the last month alone and by more than a dime in the last week.
"It's a crazy market," said Dave DeVoy, who owns and operates the Gilford Mobil Mart. "We're changing prices every day." He expected every station in the local market to be selling at less than $2 per gallon by next week. He was at $2.02 on Tuesday.
With rapidly falling and frequently changing prices, DeVoy said that he aims to hold on to his regular customers by pegging prices to his major competitors, Irving and Cumberland Farms, maintaining his profit margins. He said that because stations like Oasis Gas and Mini Market and Premium Mart purchase unbranded gasoline for less than the cost of branded gasoline he cannot meet their price. But, he added that when prices fall sharply, consumers, who are paying significantly less to fill their tanks, are less likely to shop around to save a penny or two than they are when prices are rising.
Apart from tracking the competition, DeVoy said that the 2 percent he pays on credit card transactions also factors into his pricing strategy. "When I started in the business," he recalled, "20 percent of customers paid with credit cards, but today its 80 percent. For every dollar of gas I sell on a credit card, I get 98 cents."
Wholesale price declines, which have outpaced price cuts at the pump, have significantly reduced costs and raised profits to station owners. According to the Oil Price Information Service for the past five years retail prices have exceeded wholesale prices by about 17 cents, a difference that has stretched to more than 21 cents. Butt, discounting for credit card fees and other operating costs, the National Association of Convenience Stores reports that the net profit of gasoline sales averages approximately three cents,
DeVoy acknowledged that his costs have dropped, but cautioned that as prices continue to fall, he must price to avoid the risk of paying more for the gas he purchases than he receives for the gas he sells. "I can't sell below cost," he said flatly, "but I'll take low gas prices any time. The only ones getting hurt are big oil and big banks."
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