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#11
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A buddy of mine that has a 1000 gallon tank called today. The wholesale
price of 100LL right now is $3.15 so we are going to wait a few weeks as prices are coming down. Ross Richardson wrote: We just got a new load of fuel yesterday and the price jumped from $2.94 per gallon to $3.52 per gallon for 100LL. I will have to pull the MP back a little more. |
#12
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I've not studied the mogas market specifically, but most markets are
based on speculation, not current conditions. That basically means that any benefit associated with the effects of Katrina are already built into the price of gas. Its just like the stock market. When a company announces a great new money making opportunity, you don't have to wait for it to pay off in order to see the stock price go up, the stock prices goes up right away on the expection (as long as investors see it as realistic). This is call the "perfect market theory". As long as everyone has the same knowledge base of information (something the SEC tries to assure) markets will automatically price based on that fugure information, not the current situation. So, in short, I"m saying that any benefit of the end of Katrina to gas prices has probably already been reflected in the market. It would be interesting to see what fuel futures are selling for right now. -Robert |
#13
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"Maule Driver" wrote in message om... Matt Barrow wrote: "Maule Driver" wrote in message It's nice if your local supply keeps the price based on what they paid rather than what they's have to pay to replace it. Our guys are doing the former and I thanks them. He might not have enough cash to replace it, gallon-for-gallon (unless he's really loaded which is unlikely) if the price spikes continue. Then where would you be? That's why it's 'nice' and I'm 'thankful'. If I was running the store, I'd be charging current replacement price. But in this case, it's not exactly a store, rather it's a community tank they are running like they'd want it run for themselves. That's what is so great about 'community' and being 'nice'. It's great until it explodes in your face. By the same token, one of 'them' is parking in my hangar because he is a neighbor and his new hangar is under construction. And I'm holding up on some workshop construction in same hangar until he has a place to hangar his plane. Community. Benevolence and being "neigborly". |
#14
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"George Patterson" wrote in message news:mS_Te.369$252.270@trndny05... Matt Barrow wrote: He might not have enough cash to replace it, gallon-for-gallon (unless he's really loaded which is unlikely) if the price spikes continue. He may also run into another problem, though my crystal ball says he won't. If you buy a tank of gas at a peak price and index your price to the price you paid, you may be stuck with that tank if the price then drops. This happened at Lakewood airport two years ago. If you paid peak for the new tank, but charged your customers pre-peak prices, you're dead. "Maule Driver" would love that, I guess. -- Matt --------------------- Matthew W. Barrow Site-Fill Homes, LLC. Montrose, CO |
#15
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"Gig 601XL Builder" wr.giacona@coxDOTnet wrote in message news:Yu%Te.27417$7f5.7148@okepread01... "George Patterson" wrote in message news:mS_Te.369$252.270@trndny05... Matt Barrow wrote: He might not have enough cash to replace it, gallon-for-gallon (unless he's really loaded which is unlikely) if the price spikes continue. He may also run into another problem, though my crystal ball says he won't. If you buy a tank of gas at a peak price and index your price to the price you paid, you may be stuck with that tank if the price then drops. This happened at Lakewood airport two years ago. I've seen that happen. The best bet in a fluctuating market is to by as little as you can while the price is high and as much as you can when it is lower. Since we don't know what the OP's tank and supplier situation this may not be an option. And if prices continue to escalate? The problem we're discussing is charging pre-peak prices when you know your replacement cost is going up substantially. -- Matt --------------------- Matthew W. Barrow Site-Fill Homes, LLC. Montrose, CO |
#16
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"Gig 601XL Builder" wr.giacona@coxDOTnet wrote in message news:Yu%Te.27417$7f5.7148@okepread01... I've seen that happen. The best bet in a fluctuating market is to by as little as you can while the price is high and as much as you can when it is lower. Since we don't know what the OP's tank and supplier situation this may not be an option. The best bet is to charge enough to cover your replacement, and if prices decline, you can adjust your prices accordingly. -- Matt --------------------- Matthew W. Barrow Site-Fill Homes, LLC. Montrose, CO |
#17
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Dan Youngquist wrote:
It's nice that they want to be nice, but if/when the price drops, they're going to be in big trouble. No one is going to line up to buy the expensive fuel they bought at the top of the market, and they'll have to sell it at a loss. Whether the price is rising or falling, the only way for the seller to come out even is to price according to current replacement cost. They need to make a little extra money when the price is rising, because they _will_ lose money when the price drops. The narrower the profit margin, the more it hurts. If they charge based on replacement, and if prices DO decline, they can adjust downward their current costs (higher) against previously lower costs. If they price current fuel lower, they completely remove any capacity to move prices down. It's simply a matter of thinking more than a day ahead, something so many people miss. -- Matt --------------------- Matthew W. Barrow Site-Fill Homes, LLC. Montrose, CO |
#18
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"Newps" wrote in message ... A buddy of mine that has a 1000 gallon tank called today. The wholesale price of 100LL right now is $3.15 so we are going to wait a few weeks as prices are coming down. How much reserve does he have, enough to wait out the dropping prices? -- Matt --------------------- Matthew W. Barrow Site-Fill Homes, LLC. Montrose, CO |
#19
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"Robert M. Gary" wrote in message oups.com... I've not studied the mogas market specifically, but most markets are based on speculation, not current conditions. That basically means that any benefit associated with the effects of Katrina are already built into the price of gas. Speculation is based on trends forecasting, not disasters. Its just like the stock market. When a company announces a great new money making opportunity, you don't have to wait for it to pay off in order to see the stock price go up, the stock prices goes up right away on the expection (as long as investors see it as realistic). This is call the "perfect market theory". As long as everyone has the same knowledge base of information (something the SEC tries to assure) markets will automatically price based on that fugure information, not the current situation. "Perfect Market Theory" has been debunked so many times over so many years I'm surprised anyone still holds with it. Hell, von Mises debunked it back in the 1920's. -- Matt --------------------- Matthew W. Barrow Site-Fill Homes, LLC. Montrose, CO |
#20
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Matt Barrow wrote: "Newps" wrote in message ... A buddy of mine that has a 1000 gallon tank called today. The wholesale price of 100LL right now is $3.15 so we are going to wait a few weeks as prices are coming down. How much reserve does he have, enough to wait out the dropping prices? He's just a private owner with a Cessna 172 that he keeps on his 25 acres. He has a 1000 gallon tank to make refuelling less of a hassle. If he runs out he'll just fly into town here and get gas. |
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