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ST. LOUIS — Can the day of the week a customer purchases their gas affect the price they pay? Researchers at the Federal Reserve Bank of St. Louis believe the answer is “yes” for some Midwestern cities.
Although many economists have found a link between day of the week and such things as purchasing air travel, the same has not been found for gas prices — until now. The researchers uncovered that in some cases in St. Louis, the price per gallon was 9 cents cheaper on Tuesday than on Saturday, which could save a savvy consumer approximately $60 a year.
The researchers dubbed this phenomenon the “QuikTrip Effect.” The moniker stems from the fact that QuikTrip Corp. is the dominant gas station operator in the St. Louis region and “has the ability to set prices, and competitors follow behind,” reported KHSB-TV.
“I believe there is a QuikTrip-like effect in most markets; it’s to a greater or lesser effect,” economist Chris Butler told the television news outlet.
“QuikTrip raises. Competitors follow several hours later. Then, QuikTrip will undercut the newly increased competition,” Patrick DeHaan, senior petroleum analyst at GasBuddy, added in comments to the St. Louis Post-Dispatch.
However, Tulsa, Okla.-based QuikTrip vehemently denies that the operator of 700 convenience stores in 11 states takes part in any such practices. Company spokesperson Mike Thornbrugh told the Dispatch that a “million” factors can change gas prices at the pump other than local competition. One such example is refinery problems.
When asked if QuikTrip was leading gas price changes in the St. Louis market, Thornbrugh responded that its stations are sometimes operating at “zero” gas margins, and hence selling fuel for exactly what the retailer paid for it.
Don Longo, editorial director of Convenience Store News, also expressed skepticism about the “QuikTrip Effect,” pointing out that there could be many reasons for gas price swings on a regional or market basis, and that retailers today have the capability to adjust prices almost simultaneously with changes in a competitor's price and consumer demand.
“I’m not sure I buy this ‘QuikTrip Effect.’ There is just too much competition from other convenience stores, as well as big-box companies like Costco that sell gas at low prices, for one company to set the price for all others,” said Longo.