gas prices after de...
 

gas prices after dec 31st ?  

 

stx2020
(@stx2020)
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November 29, 2012 3:20 am  

from what i understand and have heard after the 1st of the year ( a few weeks ) gas prices are most likely going up 25% - 30% due to the contract running out with hovensa

which means.. wapa going up again, food going up again, everything in general

how are people suppose to survive with these kinds of prices ?

anyone have any input ?

if this happens more and more people will be leaving the island including myself... many businesses closing cause they cant pay electric bill

what will be left ? "sigh"


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OldTart
(@the-oldtart)
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November 29, 2012 11:47 am  

I've had other priorities and haven't been tracking as best I should but the last I read negotiations between government and Hovensa were still ongoing and no final agreement had yet been reached as to the future of the facility or their agreement to provide fuel after the end of this year. WAPA's negotiations with fuel suppliers seem to be moving forward. You can pretty much keep up to date by reading the daily newspapers, etc.


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BeachcomberStt
(@BeachcomberStt)
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November 29, 2012 12:39 pm  

WAPA approves fuel contract with Trafigura

http://stcroixsource.com/content/news/local-news/2012/10/26/wapa-approves-fuel-contract-trafigura


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Landlord
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November 29, 2012 2:29 pm  

What is absolutely amazing is that the wholesale or "rack rate" price here on St Croix is greater than the street retail price for HESS Gas stations along I 95 from Washington to Florida! And that also includes all the DOT Highway, federal, state and local taxes that we do not have here. Some of the Hess Stations are also franchise units...so they pay a little more than those that are "factory stores".
Such a deal HOVENSA is giving us...of course the dealers in the states are only making about $0.35/gallon...while our local vendors make twice if not more per gallon!
Just paid $2.89 in Palm Beach County Florida...and $0.10 more in Jacksonville, Fl...it was just over $3 in North Carolina.
How did HESS do it...make gas here, ship it 1200 to 1800 miles to the states, store, and then distribute to the many states they service...all for less than it takes to drive a dozen miles here on the island????
Guess their boats and trucks are very fuel efficient!
I'll bet that the boats that will deliver fuel to the islands in the future not be as efficient in shipping costs as the ones that sailed from here to there!*-)


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Jumbie
(@ohiojumbie-2)
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November 29, 2012 4:01 pm  

What is absolutely amazing is that the wholesale or "rack rate" price here on St Croix is greater than the street retail price for HESS Gas stations along I 95 from Washington to Florida! And that also includes all the DOT Highway, federal, state and local taxes that we do not have here. Some of the Hess Stations are also franchise units...so they pay a little more than those that are "factory stores".
Such a deal HOVENSA is giving us...of course the dealers in the states are only making about $0.35/gallon...while our local vendors make twice if not more per gallon!
Just paid $2.89 in Palm Beach County Florida...and $0.10 more in Jacksonville, Fl...it was just over $3 in North Carolina.
How did HESS do it...make gas here, ship it 1200 to 1800 miles to the states, store, and then distribute to the many states they service...all for less than it takes to drive a dozen miles here on the island????
Guess their boats and trucks are very fuel efficient!
I'll bet that the boats that will deliver fuel to the islands in the future not be as efficient in shipping costs as the ones that sailed from here to there!*-)

I couldn't have stated this better Landlord. We moved back to the states this past May, having lived there for about 6 years. It had become to much of a burden from an ever increasing cost of living (food, electric, gasoline) . Having been associated in the past with the petroleum/refining business and logistics for 15 years, the pricing descrepancy in the VI vs Hess east coast was something that could only be possible with convoluted math.. Between what Hovensa charged as a rack rate to the VI independent gas stations plus the outrageous markup by gas station owners and the overly priced transportation costs given the realtive short distances, I felt in my humble opinion, the customers were always getting hosed- -no pun intended. Prior to Hess jumping in bed with PDVSA of Venezuela to form Hovensa, the gasoline prices in the VI was much more in line with realistic math.

We are visting STX this winter because we have a lot of friends still living on STX, but we are thankful we moved when we did.

Jumbie

Keith Crilow


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InnAtPelicanHeights
(@InnAtPelicanHeights)
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November 30, 2012 9:44 am  

Here is the breakdown of the cost of gas we pay at the pump here on St Croix:

3.43 rack rate posted this week, includes .14 cent tax
.08 per gallon for delivery from rack to independent gas station(in states its .05 average per gallon for trucking delivery)
.21 gross receipt tax paid by gas station to VI government, gross receipt tax is 5% of sale, so if gas per gallon is now for $4.15, the gas station owner has to pay VI government .21 cent if the gas is selling for over $4,oo a gallon(ie .05 per every dollar)

$3.72 is the gas station operator cost per , this week rack rate has been the same for the last three weeks, so most of the gas in the tanks are the rack rate of $3.43

$4.15 is common gas price for regular this week

Profit for gas station $4.15 minus 3.72 ============= .43 gallon

However, you must factor in credit card use, Basically, figure an avergage of .02 per dollar , so gas selling for $4.15 a gallon you have to add another .08 cent per gallon, profit is reduced to .35 a gallon(.43 minus .08)

I worked in accounting for the Northeast division of Gulf, if we made .11 cents a gallon profit after all expenses, we were very profitable, however, the norm was to make .07 a gallon at the gas station.

Yes, profit margin is high for gas station owners.

However, we must blame our government for most of the high cost of gas(.14 tax plus .20 gross receipt tax----government gets .34 a gallon from us .

Bottom line, get used to almost 5.00 a gallon, this is the price of gas on most of the islands in the Carribean. And I predict one major gas producer will be the provider of all the gas to the gas stations------and in 5 years, all the stations will be owned by one company, like many of the other islands who dont have enough in volume to have competition(ie Puerto Rico prices are cheaper due to the volume of sales and competetion)


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OldTart
(@the-oldtart)
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November 30, 2012 10:56 am  

It could be worse. The equivalent price per gallon in the UK is over $8!


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vicanuck
(@vicanuck)
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November 30, 2012 12:04 pm  

Same in Canada Old Tart....gas is very cheap here compared to the rest of the world.

I don't even look at the price of gas when I fill up.


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DaChief
(@DaChief)
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Posts: 129
December 2, 2012 1:37 am  

Nearly 11 months ago, I stated in one of the Hovensa Closing Forum's that I thought that Gasoline would rise to $4.90 a gallon, and WAPA to .52 to .60 a kwh. Looks like I am pretty darn close. There were some questions above regarding transportation costs and the like- after a little bit of quick research, I "found" the following-

This of course is based upon a 47,000 ton tanker, WS 100 (that has been the average for the past 12 months) loaded from the US Gulf...

Price landed to vessel- $2.93 a gallon or about $886 a LT (Long Ton)
WS 100 (Worldscale- $100 a MT (Metric Ton) for a single voyage from US Gulf to Caribbean
MT therefore is 47564 MT (47000*1.012)
Price is therefore $897 per MT
Landed Price to VI- $997 per MT or $3.24 a gallon landed here.
Storage and rack Cost (estimated) .07
Transport Cost to Station .12

Add Tax and Gross Receipts Tax= (.14 per gallon) plus Gross Receipts Tax (.05) .14 + .16= .30 a gallon
$3.43 + .30 = $3.73 a gallon.

So the current rate is around $4.25- (on STX) meaning that the stations have about .52 a gallon profit- Most stations in the states usually mark up about .20 a gallon maximum.

I have always advocated for the DLCA to regulate this to a maximum of .35 to .40 a gallon...


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Novanut
(@Novanut)
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December 2, 2012 1:50 am  

Buurrpp!!! Working on ways to use my 'natural gas' to solve my energy difficulties...


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InnAtPelicanHeights
(@InnAtPelicanHeights)
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Posts: 319
December 2, 2012 11:45 am  

DaChief , I recall your posting and had predicted the same with gas and WAPA rates.

DLCA would be the start in helping and stop the excessive profit margins for gas by regulating profit margins on sale of gasoline , especially on St Croix is basically a monopoly---although owned by independent owners. I see our future gas stations being owned by one major entity in the next few years----like it is on many other islands.

DLCA should also look at the prices of groceries, my understanding milk, eggs, cheese, bread etc are some of the highest markups because of the amount purchase under the WIC, and the markets get the maximum value of the vouchers when the vouchers are submitted and redeem by the federal government, ie this information is only second hand, never able to find anyone in the WIC federal program and or information to prove out this information


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DaChief
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Posts: 129
December 2, 2012 3:29 pm  

Inn,

I couldn't agree more. While ordinarily I would be against any type of regulated price controls, it is becoming very evident that they are sorely needed. We are in what I like to term a "macro economy of cannabalistic nature", meaning that because the largest part of our workforce works for the government, they are in fact working for a paying themselves to a certain percentage.

I have "heard" throught the coconut telegraph- rumors of constortium type thinking and price rate amongst a fair amount of the service station owners. The mere fact that DLCA has done nothing meaningful with respect to ensuring that gas prices have dropped when the rack rate did- except for minor pronouncements "that we are watching" shows that a fair amount of retailers in the gas and food markets can get away with whatever they like- often to the consumer's detriment.

Face it, we need price controls- a fixed income senior citizen must be getting racked over the cost of electricity, food, gas, and most other staple items, probably having to choose between darkness or a grumbling stomach- I also think that they pharmacies should be monitored too..


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