What’s causing the steep gas price drop in certain Minnesota towns?

HASTINGS, Minn. — Fuel costs are fortunately falling. The common worth per gallon in Minnesota is about $4.50. However some components of the state are already nicely underneath $4.

What’s inflicting the steep worth drop in sure cities? Good Query. Jeff Wagner tries to determine what’s fueling this thriller.

From M&H gasoline station in Hastings, to the Vacation station throughout the road, the nice vibes are flowing simply as quick because the gasoline.

On the highest ten record of most cost-effective gasoline costs in Minnesota, six areas are in or close to Hastings — at a variety of $3.68 to $3.88 a gallon. That is as much as 70 cents cheaper than the state common.

So what’s behind these costs? We spoke with Alfred Marcus, a professor on the College of Minnesota’s Carlson College of Administration.

“Basically, I feel you may discover in rural areas, the gasoline is slightly bit inexpensive than it’s in city areas,” Marcus stated.

That is as a result of city areas have greater demand, typically resulting in greater costs. However that also does not clarify the massive discrepancy right here.

One among Marcus’ theories is Hastings’ location, which is brief drive from two oil refineries. So why is not each city close to the refineries promoting gasoline underneath $4?

“There is likely to be, you realize, a sort of worth conflict happening,” Marcus stated.

Competitors in Hasting could possibly be fierce. Minnesota legislation requires retailers to promote gasoline no less than 8 cents greater than they purchased it — so making a revenue is required.

“They could additionally wish to draw visitors from different stations,” Marcus stated.

The attract of saving on gasoline is sufficient to make drivers burn it. Hypothesis apart, we went straight to the supply for the key behind the pricing. Sadly, the homeowners of the gasoline stations stated they weren’t allowed to remark.

Different Minnesota cities the place gasoline costs have dipped beneath $4 embody Buffalo, St. Cloud and Vermillion.