Why do supply and demand not seem to apply with gas stations, with such varying prices and “that really cheap place!” phenomena?

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I have never, ever understood this. Gas is for the most part is a simple commodity. Sure, some prefer a premium brand (like Shell) to a cheaper one (like ARCO), but I can’t for the life of me figure out why there is such a wide variance even within a single mile or two of a city (and amongst the same brand!) I would think that supply and demand would reign supreme here. It’s the same stuff.

You get that one gas station that charges $0.10 less than all the others in the area and the lines are out to the street.

So where are supply and demand?

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33 Answers

Anonymous 0 Comments

I worked for a grocery store and someone left the intranet open on the gas price page. The company was tracking gas prices at every station within a few miles of every store with a gas pump.

This was 20 years ago, I can only imagine that the big players have it all tracked and adjust prices algorithmically.

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