Hate hearing that, especially when stateside prices are so much lower and Hovensa is still charging more for older stock. Bummer! Can't believe Tortola has better price! What are they paying?
I guess everyone will have to hurry up and use up that pricy old gas in order to see if they lower the price when they get the fresh stuff.
I guess folks on STX are paying extra for the old gas in the entire Hovensa tank farm because they can't afford to tanker the rest of it to the mainland and sell it at current prices without a loss.
They don't sell gas to the mainland. They buy on the open market to supply STX only. And that will end in 4 weeks.
The whole "we still have old more expensive gas" thing is a red herring. You bet your butt when the price of global gasoline was rising there was certainly no 6-month delay in passing the increase along to consumers. In free market economies the price to the consumer, up and down, moves nearly lockstep with the global marketplace for unleaded gasoline. There is no delay. Companies hedge their production and delivery using oil futures as well as unleaded gasoline futures themselves. The problem is that we do not have a free market in the USVI, we have a de facto monopoly.
Just for come more color, unleaded gas futures on the CME (part of this global market I referenced above) spent all of 2013 largely trading in a tight range of $2.40 to $2.55/gallon. In mid June of 2014 it was trading at $2.75-$2.78. As of yesterday's close, it is trading at $1.81/gallon. So if the markup (delivery costs, profit, etc) in the USVI averaged $2 a gallon (so 2013 averaged about $4.50 to the consumer) that same $2/gallon markup over the futures market here implies a retail price to the consumer of $3.81/gallon today in the USVI.
$4.259 @ Hometown yesterday. Lining up for that "cheap" gas
I heard once that gasoline wholesalers and retailers normally sell their current inventory based on their replacement cost. Along with Hovensa's monopoly factor, there's now no planned replacement of inventory, so they have even less reason to lower the price.