(CBS) — That gas station on the corner that’s been selling gas under $2 is suddenly up by 10-15 cents today.
Patrick DeHaan with GasBuddy.com says it’s a matter of competition and something called price cycling.
“What we are seeing a slingshot back those stations readjusting their prices to make 15-20 cents a gallon as opposed to selling at a 20 cent a gallon loss. Sometimes those increases can be rather significant but motorists shouldn’t worry to much, prices will remain relatively low, ” said DeHaan.
Dehaan says prices tend to much more competitive in the suburbs.
“Where there are more gas stations, there is more competition. That’s when you see gas stations warning against themselves. to who can have the lowest price and sometimes they get ahead of themselves and drop prices that are almost unsustainably low and then you’ll see the slingshot back.”
DeHaan says in the next few months, its likely gas prices will continue to fluctuate between 2 and 3 dollars a gallon.
In the suburbs, prices could continue to hover around $2 a gallon. Gasoline prices in Chicago averaged $2.41 per gallon on Sunday, a decline of more than $1 from a year earlier.
Phil Flynn says lower gas prices are here to stay, but that’s not necessarily a good thing.
“My concern is that this drop in gasoline prices could signal something more ominous,” he said.
Like job loss in the U.S. oil industry and lack of confidence in the stock market.
“A lot of oil workers are going to start seeing pink slips,” Flynn said. “We’re going to probably see some of these jobs, these high paying jobs that have been created in this industry, start to go away.”