STX Gas Price

I have a feeling, that if I were to open a gas station, and price gas fairly in the VI, I would meet a very short boat ride to a deep hole. Why won't anyone go just a few cents lower to beat the competition?

Collusion, perhaps?

The last 2 Hovensa price decreases were .05 and .07 as I recall.

So Hovensa decreased the price .12, and the gas stations decreased by .10

And Yes, Alana, there is collusion. There always has been, back to the '80's when I ran a gas station.

I have withheld my opinion on the STX gas prices for quite a while. I totally agree Sky's comments about having a lower price than other stations.

In my opinion there has to be some "behind the back crap" or under the table shenagins going on with Hovensa and the VI Gov't. Why else would Hovensa only have lowered prices to the gas station owners by $.12/ gallon total for the past several months, when stateside gasoline prices have dropped 4x-5x that much in same time frame?

I think the gas station operators in the VI are getting hosed by their own legislature & Hovensa (Hess) a lot more than the gas station owners are hosing their customers.

I copied an pasted part of the VI Daily News that appeared today 11/10/14.

HOVENSA again bucks national trend and holds price of gas steady
DAILY NEWS STAFF)
Published: November 10, 2014

ST. CROIX - After lowering its wholesale gasoline price slightly last week, HOVENSA left the wholesale price of gasoline at its truck racks unchanged today.

Meanwhile, nationwide, gasoline prices continue to drop drastically.

HOVENSA each week evaluates its rack rates - the price of fuel purchased wholesale at the HOVENSA truck-loading station on St. Croix - and may adjust them.

With no change today, independent gas station operators in the territory are paying $3.42 per gallon for regular gasoline, $3.74 per gallon for premium gasoline, and $3.46 per gallon for diesel fuel when they buy their fuel wholesale at HOVENSA. Those prices include the 14-cents-per-gallon tax that HOVENSA collects for the government.

There is one more scenario and assume there is no "kick back" going on with the VI Gov't or VI officials. That would be that Hovensa (Hess) is making a big profit on the gasoline before they sell it to station owners. If you take away the VI tax of $.14/gallon, Hovensa is selling regular unleaded on STX at $3.28/gallon. Compare that to Hess selling gasoline in Boston, Mass area for $2.91/gallon.

Bottom line --there's something that just don't add up to the current economics of price of crude (below $80/barrel) and the sale price of regular unleaded stateside.

Jumbie
(Soon back on STX again --paying out my ying-yang for gas).

When did hovensa buy the gas they are now selling?

And given the massive size of the continent of STX and the corresponding enormous volume of fuel sales they have a big motive to jack up the sales price and rake in the profits. not. They probably sell more gas in Boston in one day than all month on STX.

Wouldn't collusion amongst gas stations to set same prices violate antitrust laws?

Wouldn't collusion amongst gas stations to set same prices violate antitrust laws?

absolutely.

And given the massive size of the continent of STX and the corresponding enormous volume of fuel sales they have a big motive to jack up the sales price and rake in the profits. not. They probably sell more gas in Boston in one day than all month on STX.

I will concede to you higher volume sold does generally have a lower profit margin; lower volumes sold generally have a higher profit margin for the seller.

Also Alana 33 - you will never be able to prove collusion; it also happens stateside and . in my small community of 22,000; all the gas stations seem to change price the same day and generally the same amount.

My general premise here is that Hess Oil exited their refining of crude (in U.S. & STX) in past 2 years. So whatever gasoline they sell at their Hess stations up and down the U.S. East Coast has to be purchased from "some refiner". The refiners who sell gasoline have significantly lowered sell prices in past several months. I admit I have no idea where Hess buys the gasoline that is sold at their branded stations or specifics on STX volumes purchased, inventory turns, price paid, etc. However I still think only reducing their sell price at the Hovensa rack by $.12/gallon is an insult to most people's intelligence. The VI Daily News coverage of the rack rates posted each Monday has the tone for past several weeks that they too are "puzzled" by Hovensa's price decisions given the big downturn in U.S. average sell price.

Hovensa and Hess are private companies who can buy and sell for whatever they want. They also have very little competition here so of course they can sell for more.

Regarding gas stations all moving in lock step with their pricing, that's the way its always been no matter where I've lived.

The average margin in the States for a gallon of gasoline is $.15-$.17 PER GALLON.
Seems like a fair profit.

We are paying $.77 per gallon to the thieves.

If the gas Hovensa is selling now was purchased in May before prices made the big drop, why would they sell it locally at a loss?

So I go back to my first question - WHEN did they buy and how much did they buy and what is the monthly usage rate?

If you can't answer that, your complaints have no merit since your assumptions could be incorrect.

Hess, for a little while, used to produce gasoline at their New Jersey site, which wasn't really a refinery because it was an FCC Unit to make gasoline from product purchased locally. That site was closed.

Hess no longer owns the gas stations in the USA. The were sold recently to Marathon Petroleum Inc. for 2.8 billion.

But, the point remains. HOVENSA buys finished product that carries much higher costs. Nonetheless, their prices, for whatever the reason (known to them as a private enterprise) never follow market tendencies. We deal with a monopoly and have no choice other than complaint and hope for the best.

But Rowdy, if Hovensa is screwing the public with a high rack rate when prices are dropping, how do you explain the higher gas prices on STT?

Its a game people...Hess make their money when and where they can and I'm sure they're making gobs of it.

Regarding gas station profits, if it seems that owning a gas station is so profitable, you're always free to purchase your own station so you can make piles of money too. I personally don't like the smell of petroleum products so I choose a different profitable business to buy.

I don't get why people bitch about gas station profits and not the profits made by other super lucrative businesses that you use everyday.

But Rowdy, if Hovensa is screwing the public with a high rack rate when prices are dropping, how do you explain the higher gas prices on STT?

I can't answer that. I repeat, the are the ones that know as private entities. Call HOVENSA and the gas stations on STT and STJ and ask them.

It still wouldn't be much different than driving in the USA and see major gas prices changes from one area to another. And I am not talking from one state to another, you see different prices inside a small county.

I agree with Rowdy on his statements this am (11/11) and also agree with sunshinefun's posting this am (11/11)..

Sooner or later --maybe later as in weeks from now, Hess/Hovensa will lower the rack rate to gas station owners that reflects the decreased pricing of crude on the world market. But as pointed out above - Hess has a monopoly in the VI and adjusting price is strictly arbitrary on their part.

With the U.S. producing 2-3x more than in years past, as a result of the crude from shale drilling in ND, Ohio, and some other states, the supply of crude has increased in the U.S and has driven down the price so far OPEC is talking cuts in production to drive price back up.

Copied and pasted this from the internet today.
Expectations of growing U.S. crude supplies sent world oil prices sliding to a new four-year low and is turning up the heat on OPEC members to cut production when they meet later this month

Hate driving past the closed Domino gas station in Sugar Estate and seeing their old posted price in the $3.29 range (or around there) and then driving to the gas station by post office to fill up @ $4.599 per gallon for regular.

I'd bet Jim Rockford could prove collusion if there is any. Just takes some serious investigation. Where are the local news reporters when you need them?

I don't know what's worse, paying the same price for gas all over town or driving a few miles across town to pay $.20 a gallon less. (I've been doing the latter) Unless of course the price is jacked up all over. What's the price in San Juan these days?

Regular price around here in NC today is 2.68-3.39. Looks like crude has been inching up over the past week and US avg gas price just started up a bit, too soon to tell if a trend.

Regular price around here in NC today is 2.68-3.39. Looks like crude has been inching up over the past week and US avg gas price just started up a bit, too soon to tell if a trend.

The crude oil price has been holding steady for a few days now in the $77 to $78 range per barrel.

Brent Crude is on a "record" low of $81.18 as of morning today.

So the price going up at the pump in the USA is due to other reasons.

In the meantime, we all enjoy HOVENSA's monopoly. The price of regular gas here is way higher than the price of diesel and premium in most of the USA (except maybe Hawaii and California).

Isn't STT getting their gas from PR?

Isn't STT getting their gas from PR?

Off the record, a gas station employee on STT told me some get supplied from PR (Puma, to be more specific) and, in some cases, they also get it from HOVENSA. So you are correct.

My mental GPS tends to be on STX even when I have to travel to the USA to work every now and then.