Experts suggest sales volume and competition may be to blame,
but few are certain about what’s driving Hollister’s gas prices
higher than those in neighboring cities.
Hollister – Experts suggest sales volume and competition may be to blame, but few are certain about what’s driving Hollister’s gas prices higher than those in neighboring cities.
A random survey of seven gas stations showed that the average price of unleaded regular gasoline in Hollister is $2.80 per gallon – 17 cents higher than the average of $2.63 per gallon just 15 miles up the road in Gilroy.
“Rural communities seem to have higher prices, but there are legitimate forces in the market that can lead to higher prices,” said Sean Comey, a spokesman for AAA of Northern California. “The of world of gas pricing is of Byzantine complexity, but the retailers are not making the lion’s share of the profits.”
The bulk of the profits are made by large oil companies and refineries, Comey said, but competition is also a factor
“It’s the marketplace that determines the price,” he said. “I recommend that consumers shop aggressively. Pay attention to who is selling for what price. Prices fluctuate all the time so the place that was the cheapest last time might not be cheapest the next time your tank is empty.”
If Hollister gas stations realize that they are losing customers to their counterparts in Gilroy or elsewhere, they may decide to drop prices, Comey said.
Graham Mackie, Co-Owner of Dassel’s Petroleum, Inc. in Hollister, believes that the volume of sales may be one factor driving up the cost of Hollister’s fuel prices.
“Because (local service stations) don’t move as much volume, they probably need to make a little more,” he said.
Competition is likely another key factor, said Jerry Cummings President of Rotten Robbie’s, a regional chain of gas stations. Although Hollister doesn’t have a Rotten Robbie’s, Cummings said that if it did, he would base the per-gallon price around what other stations were charging.
“It’s more competitive than people think,” he said Monday. “It’s a watching game and people are very competitive.”
Cummings said his price scouts may check on the pump prices of other stations two or three times a day.
Although he wasn’t sure exactly why, Quick Stop Store Manager Joe Hippler believes Hollister’s gas prices are usually the last to change.
“We’re usually the last ones to go down and when the prices go up, we’re usually the last ones to go up,” he said. “It’s just the marketing area, we may be 10 or 15 cents higher now, but that’s not always the case.”
Although gas prices in Hollister are above the statewide average of $2.69 per gallon for regular unleaded gasoline, they are far from the highest in the country and even farther from the lowest, Comey said. Residents of Wailuka, Hawaii paid an average of $3.06 per gallon on Monday while residents of Springfield, MO paid an average of $2.00 per gallon.
Regardless of the cause, Hollister residents aren’t happy about shelling out a few extra pennies per gallon, Hippler said.
“There is a lot of grumbling,” he said. “A lot of people have told us that (gas) is cheaper in Salinas and Gilroy, but it’s not always economical to drive 15 or 20 miles to fill up the tank.”
Brett Rowland covers education for the Free Lance. He can be reached at 831-637-5566 ext. 330 or
br******@fr***********.com
.
