Quote:
Originally posted by ltl/fb
Who owns the terminals?
How do they know when to raise prices?
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The oil cos. or independent wholesalers. It depends.
They know when to raise prices when they aren't selling their gasoline. ExxonMobil, for example, doesn't distribute only to ExxonMobil stations. They also sell gas to independent wholesalers, who then serve gas stations like "Gus's Gas" and "Gas4Less" and "CheapGas". Those wholesalers don't always supply Gus with ExxonMobil product. They shop around, so if Shell offers them a penny less, Exxon won't get the sale. When Exxon stops getting sales, or getting less, they cut their price.
And it's not like there's one price for gasoline. Each terminal will have a different price depending on its location and distance from the refinery. And then there are multiple grades of gasoline, not just regular/premium, but all the different formulations for environmental specs. Coordinating prices would take a huge effort of computerization, and even then the companies could cheat easily on each other with no way of knowing it was going on.
