For the Upper Midwest, lower gas prices were fleeting

Twin Cities gas prices increased another 10 cents a gallon today — that’s a 30-cent run-up in a week. But that’s not the story; this is the story.

diesel.jpg

The price of a gallon of diesel fuel is now equal to — or, in many cases, less than — the price of a gallon of regular unleaded.

Since September of 2004, diesel has been higher than gasoline, mostly because of worldwide demand for diesel, tight refining capacity, the transition to ultra-low sulfur fuel and a federal excise tax that’s 6 cents higher than for gasoline.

This week the Energy Information Agency lowered its projections for the cost of both diesel and gasoline, citing a weakening economy.

But that doesn’t explain why one fuel is dropping and the other is going up. Apparently, it’s not just us. In Ohio, gasoline dealers say they’re frustrated because the prices are going up while the price of crude is going down. They contend wholesalers and oil companies are trying to make up for the money they lost earlier in the year.

A look at the Minnesota gas prices vs. crude price gives that view some credibility.

Minnesota Historical Gas Price Charts Provided by GasBuddy.com

Economists had hoped lower gasoline prices — other than California, Minnesota has some of the highest gas prices in the country — would get people to spend more.

At $3.79, the price of gasoline is only 4 cents away from the highest average price in Minnesota in more than a year.

Meanwhile, for truckers — especially independent truckers — the lower prices go right to the bottom line. I wrote this article about one such trucker in 2008. Four years ago, he was paying 20 cents more a gallon than he is today.

  • JackU

    other than California, Minnesota has some of the highest gas prices in the country

    That’s not what my limited anecdotal evidence says. I have family in NY (NW of NYC near the NJ border). My mom has always paid more for gas than we have out here. The difference is often around 30 cents a gallon and at one point was closer to 50 cents a gallon.(Their prices didn’t come down as fast as ours.) They were up over $4/gal for more than a month between March and May. I agree with the California mention. My sister lives in LA and she has had gas prices close to $4.50/gal for sustained periods already this year.

  • Bob Collins
  • Mark B

    It simply isn’t true that Minnesota has some of the highest gas prices in the nation. We’re usually right about in the middle. In the Midwest, much of Illinois has higher prices, not to mention the East Coast, West Coast (not just California), and Hawaii. Atypically inaccurate reporting from MPR that you really may want to correct.

  • Bob Collins

    I wish you’d taken the time to click the link I provided below to the price “heat map.” If you had, you would find that, indeed, right now, Minnesota has some of the highest gas prices in the nation, which was accurately stated, and you didn’t provide any information to point out that it’s not the case.

    It’s irrelevant what we “usually” have. The observation involves the ‘right now,” and that SOME of the highest gas prices in the nation — exclusive of the west coast — are in Minnesota.

    You’re right, however, that the west coast/Hawaii/Utah etc. shouldn’t have been lumped in with “California.” Utah, by the way, has an average price 8 cents cheaper than Minnesota, Both Oregon and Washington are higher. Arizona is 25 cents lower, Colorado is 10 cents lower, Nebraska 23 cents lower, Iowa is 30 cents lower (you may have noticed, I just “drove” from Minnesota to San Diego without finding gas prices higher than Minnesota’s average).

    Today, the Twin Cities has an average gasoline price of $3.73. The nation as a whole has an average of $3.53 (South Dakota averages $3.53 by the way, Wisconsin is 18 cents a gallon cheaper on average, North Dakota is 25 cents a cheaper. And, as you can see if you look at the facts, the southeastern part of the nation is living the dream right now at 55 cents a gallon cheaper.

    As for your citation including the East Coast, Massachusetts is 30 cents a gallon cheaper, New York is 3 cents a gallon cheaper, New Jersey is 43 cents cheaper, Pennslvania is 35 cents cheaper, Virginia is 48 cents cheaper and on and on and on it goes.

    It’s true that those areas USUALLY are not cheaper than Minnesota, and it’s true that up until a few months ago, the upper Midwest had comparatively cheaper fuel, but the facts are that that is not now the case.

    What’s more, the national average went DOWN yesterday. The Twin Cities average went up.

    Those are the facts, which completely parallel the observation. Whether you agree with them or not doesn’t change the fact they’re facts. If you’ve got different ones, I’d love to see them.

  • Tyler

    The conspiracy theorist in me is convinced that gas companies rotate high gas prices throughout the nation, so that we occasionally get “relief,” and they consistently get high profits.

  • Brett

    Bob, I think your use of the simple present-tense verb “has” is what confused people. Without other context, “…Minnesota has some of the highest gas prices in the nation” sounds like an ongoing, semi-permanent state of affairs, since gas has been something people buy for the better part of a century. More nuanced phrasing would have clarified things a bit.

  • Bob Collins

    //e an ongoing, semi-permanent state of affairs, since gas has been something people buy for the better part of a century. More nuanced phrasing would have clarified things a bit.

    I treat “has” as present tense and “has had” as indicating a present situation with a past-tense life. Usually, I would also start a sentence with “Historically, ” to denote … well, you know. Or “usually” works.

    I could write, “Presently, Minnesota has…” but that’s just terrible writing. :*)