Why do gas prices differ from Jefferson City to Columbia?
Wed, 10 Aug 2011 22:19:19 GMT —
Update: August 11 at 12:30 p.m.: Several KRCG viewers have asked why the Mayor and City Council has not stepped in about the gas prices.City Councilman David Griffith said he does not think the city should address the issue."There's not ordinances to fit every situation," Griffith said. "Gas prices have been an issue for a number of years. I don't believe the City Council or Mayor has the authority to set gas prices."Griffith suggested concerned citizens contact the Attorney General's Office with their comments."They could look into if there is price fixing going on," Griffith said. "At the end of the day, though, supply and demand will drive the prices."Griffith said the city is also feeling the pinch at the pump. He said they are looking at budgets now, and that includes budgeting money for the city vehicle fleet.He said in the past, the city council has had to give supplemental money to various departments for extra fuel costs."I don't speak for the mayor," Griffith said. "But one thing I think we could look into as we are purchasing new vehicles for the city fleet is buying hybrids and other gas saving vehicles. Every city employee does not need to be driving a pickup truck."Mayor Eric Struemph was also contacted about this story, but he is out of town and said he would talk about it with a KRCG reporter when came back. Original Story: The age-old question of why Jefferson City's gas prices are always higher than those in Columbia is a little closer to being solved.It could be due to a lack of competition.We asked John Kolb, President of Jefferson City Oil Co. Inc., why he thought there is such a variance between the two cities."Jefferson City is just kind of a mix of independent dealers, whereas in Columbia you have major players like Breaktime and Quik Trip ," Kolb said. When a major dealer sets prices for a city, others follow."Kolb said Quik Trip started the latest price war in Columbia which brought prices down to $3.19 a gallon Wednesday.With the absence of a "major player" in Jefferson City, Kolb says stations in the Capital City aren't forced to meet their prices.Quick Trip has an unfair advantage, according to Kolb, because it supplies its own fuel and doesn't have to rely on an outside dealer.The lowest price is not necessarily the fairest price for the business owners, sometimes a low price is brought on by a large competitor and they're forced to meet their price," Kolb told us.Kolb said Jefferson City gas stations should get a pat on the back for having their prices 11 cents below the state average of $3.40 per gallon.Kolb also disputes that Jefferson City gas prices are always about a dime higher than Columbia. He also predicts that the $3.19 price per gallon in Columbia won't last long because of a "severe market shift" happening Wednesday afternoon that will push wholesale prices up.What do you think? Is a lack of competition to blame for Jefferson City's gas prices?