Article “Why gasoline prices rocket up, yet drop slowly” states: …Gasoline retail prices rise four times faster than they fall after the wholesale price changes, according to a 2010 Federal Trade Commission (FTC) study.
In some places around the country, gasoline retailers sell at a loss when wholesale prices are high, and they try to make up that loss when prices go down, said Matthew Chesnes, the economist who conducted the FTC study. Retailers say keeping prices higher for as long as possible is the only way for them to make a little bit of a profit or, in some cases, break even…
Gas stations make most of their profit from attached convenience stores, said Jay Ricker, who operates about 50 gas stations in Indiana. If a sign boasting low prices draws drivers to the station, they’re more likely to spend money in the store…
WATCHDOG: If you believe the above explanation, we have a bridge for sale cheap in Brooklyn for you. Retailers have little if any control over the wholesale price of gasoline. Many reports indicate that the delay is the result of market manipulations by speculators. This is the type of article that gets written by underlings to fill space during the summer lull and while others are off on vacation.
It’s called “sticky prices”. Explained in first year economics class.