With gas prices soaring, and now at the highest levels we've seen in years, we are all looking for ways to save money at the tank. The best way to do that could be by timing your purchases properly, say experts.
The time of day can also be a factor in gas prices. According to Brad Proctor, founder of GasPriceWatch.com, a price-comparison website for consumers and corporate fleets, the best prices are mostly likely to be found before noon. "In any given community, especially major towns, there's going to be a big player in gasoline," says Proctor. "These are the company-owned stores, and they have a process where their managers come in every morning with a list of their competitors' prices." The pricing data is sent from each store to a central corporate data center, where it is used along with other information like cash flow, market costs and the stock market to set the day's prices for the entire chain. "This is generally done first thing in the morning," says Proctor.
Once the big players set their prices, the other stores in the area follow suit. "You get a couple of organizations like Sam's which will hold their prices for 24 hours," says Proctor, "but everyone else will jack theirs up right away." He says you generally have an hour or two before all area stores are selling gas at pretty much the same price.
You might think holding prices down would be a good competitive move for these smaller stations, but Proctor says maintaining price parity is actually a survival method. "If they're selling at 20 cents below the station across the street, they're going to have a run on gas, and they're going to run out." If that happened, it could be days or even a week before they get a new delivery of gasoline, since these smaller companies don't get delivers as often as giants like BP or ExxonMobile.
Once prices rise, they come down more slowly. "That's natural competition," Proctor says. "It's the normal cycle of what happens. But when it goes up, it tends to go up big," so he says filling up in the morning is still the safest bet for your wallet. "When I win and save money, it buys me lunch that day every time."
Does morning shopping provide another economic incentive? Many people believe that buying gas when it is cooler outside, like in the morning or the evening, will save you money. Proctor says there is a science behind it, but colder temperatures won't give you enough extra volume of gasoline to make a major difference.
Picking the right day to buy can result in significant savings, said Jason Toews, co-founder of GasBuddy.com, another site which helps consumers compare local gas prices. "Wednesdays are the best day of the week for cheap gas prices," he told Kiplinger's Personal Finance. "Stations tend to raise prices on the weekends and especially during the summer." So avoid filling up on peak travel days and stick with the middle of the week if you can.
Making the right decision about where to buy can also potentially save you money. GasBuddy has several money-saving tips on their site, such as buying gas from suburban stations, rather than in affluent metro areas, where prices will tend to be higher. In addition, gas stations on the freeway or near major exits will also tend to have more inflated prices.
Other good ways to save money on gas, according to MNN's Russell McLendon, include keeping your speedometer below 60 mph, avoiding idling, and making sure your gas cap is securely tightened to avoid any evaporation.