Gas prices didn't just hit $4 a gallon in the Twin Cities Monday, as many expected, but blew right through the milestone, as stations followed SuperAmerica's overnight leap to $4.09 for regular unleaded.
Minnesota drivers knew it was just a matter of time once the national average for regular gas beat $4 a gallon for the first time on Sunday. The quick spike was blamed on two crude oil records set Friday: a $10.75 one-day gain and a $138.54 a barrel closing price.
"It has been very difficult to maintain [status quo], with the cost increases in crude" in recent weeks, said Speedway SuperAmerica corporate spokeswoman Angelia Graves, in Enon, Ohio.
Still, some Twin Cities outlets held their prices down, at least into Monday evening. Costco in Maple Grove was the lowest, at $3.71 -- 39 cents a gallon cheaper than the highest metro price. Company spokesman Bob Nelson denied rumors that Issaquah, Wash.-based Costco uses gasoline as a loss leader to sign up more members who pay a $50 annual fee to shop in its discount stores.
"We're not going to sell it below cost," Nelson said, adding that gasoline sales are up.
Otherwise, Monday's price movements showed that the most powerful influence is what's posted at a station's nearest competitors. Two stations, a Mobil and Holiday in Bloomington, had the area's highest prices midday Monday at $4.10 a gallon. They're at the same intersection in Bloomington. Also, five stations that held their price to $3.79 throughout the day all were in St. Louis Park. And while all SuperAmerica stations raise their price in unison, they are then free to re-set prices as needed.
"That's when you start analyzing what's going on in the marketplace around you," Graves said. "It's very competitive, and it's extremely local." That's why SuperAmerica stations had a variety of prices Sunday -- before the $4.09 move -- some as low as $3.83 cents for a gallon of regular.
But once it made its move Monday, other stations followed. Holiday, Shell, Sinclair and BP stations started to match the SuperAmerica price, according to the website twincitiesgasprices.com.
"My guess is that most places will be at $4.09 by 11:59 tonight," Jared Scheeler said Monday. He's head of operations at Bobby and Steve's Auto World, a Mobil station in downtown Minneapolis. "By then it won't be the 'SuperAmerica price,' it will be the "street price,'" he predicted.
Scheeler said SuperAmerica's increase was restrained, if anything. His wholesale price rose 12 cents a gallon Thursday, then another 20 cents a gallon Friday. That means at $3.89 a gallon through Monday, he lost money on every sale paid by credit card, after factoring in the card company's transaction fee. He plans to raise his price Monday night, although he expects that he and many others will stay -- or retreat to -- below $4 as long as they can.
That may not be long. Some energy analysts are predicting $150 oil by July 4.
H.J. Cummins • 612-673-4671
