Gas station fluke results in $1.10 pump price

LOS ANGELES - Word spread quickly about a Los Angeles gas station selling premium unleaded for $1.10-a-gallon, but it wasn't a promotion. The owner says the too-good-to-be-true price was a computer glitch that cost him $21,000.

Long lines snaked from the pumps at the Valero station in Wilmington on Sunday. Police were even called to control traffic.

The Torrance Daily Breeze reports that within four hours, about 7,000 gallons of premium were pumped at the discounted rate.

Station owner Kenny Nguyen says the attendant on duty was busy staffing the convenience store and register.

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He says a price change didn't take, so the system defaulted to the $1.10 price — a cut of more than $3 a gallon.

Nguyen hopes motorists who got the break come back and pay the real price.

[Meals_On_Wheels]

All Americans are paying top dollar for gas, but those who don't drive pay the highest price. Homebound seniors across the country rely on Meals On Wheels deliveries for the nutrition they need to survive, but our programs are struggling because of the cost of fuel. To learn more about how you can help Meals On Wheels programs feed hungry seniors during this crisis, visit www.mowaa.org or follow us on facebook at Meals On Wheels Association of America.

[Stephanie41487]

Comment: Gas prices do hurt the wallet. I cannot agree more. That is why I use my Global-Fleet fuel card. The application process was easy. Check out the site global-fleet.com.

[gnimelf1968]

You know it's also interesting how when Bush was President and gas went up it was all HIS fault. Now when the gas prices go up it's still because of the republicans. You people are nuts!

[banzaigtv]

I would think that there would be long lines of cars stretching from L.A. all the way to the US East coast. Interstates 10, 20, 40, 70, 80, and 90 would all be severely congested right now. LOL

[djseavy]

The stations make very little on gas. Why do you think all the "service stations" closed and they're all convenience stores now? They make their money on what's inside, not at the pump. And the attendant that was so busy minding the store that he/she didn't notice something was wrong when suddenly people were buying a whole lot of gas and paying a whole lot less, I hope to God he/she doesn't have a twin.

[rightbehind]

I got a email news letter from the local republican congressman about how they passed 3 bills all having to do with more off shore drilling. They keep implying the oil is for the us the United States. They never say anything about the fact that no matter how much we drill here or drill now the oil automatically belongs to the "world market". The republicans signed away our, The United States, rights to the oil to off shore global tax havens. Our children's futures have been robbed by the republicans. I would nationalise the petroleum industry and make all those 9.2 million jobs good government jobs. I for one have had enough of political parties pushing ideology by controlling resources.

[fishguru00]

what planet are you from...

[pwgrant]

i dunno; maybe EARTH! you idiot!!! Take your head out of the sand. moron.

[mary-miami]

$1.10 a gallon should be the real price of gasoline, certainly not more than $2.00. Rich oil barons are raking in millions of dollars in profits, while consumers are paying double the price in groceries. We all know that when the price of petroleum goes up, so does everything else because it gets to our stores by "transportation"...trucks, trains, planes...you name it. To make matters worse, big oil has also been getting government subsidies (more money). Republicans and Teaparty represent the very rich, so they don't want to stop giving them these perks. The GOP don't care about the working class so everytime they enact a law it is to benefit the wealthy. We need to stop the subsidies to big oil and increase taxes to the rich. Rich CEOs don't create jobs in the US, they create them in China. The only party that cares about equal rights and opportunities for everybody is the Democrats. I will vote to re-elect President Obama in 2012.

[gnimelf1968]

Yes demoncrats want equal rights for everyone but them. No rights.

[sharong59]

Your comment makes a lot of sense, Mary! Anything below $2.50 per gallon would be exceptable to me! It's about time people see the GOP true colors . . . black! They aren't fit to shine Obama's shoes! Obama 2012!

[Lawyers-Guns-n-Money06]

Nguyen hopes motorists who got the break come back and pay the real price.

================================

Dude, the five-oh had to be called in to control traffic. Best you can hope for is that some of these customers were new and will become repeat customers. That and see if that "glitch" in the software was not a result of your own human error and file a lawsuit. It's the American way.

[ddal10]

I remember when gas was .26 cents per gallon! A coke was 10 cents, a pack of smokes 23 cents and a nice home for 15,000 bucks!

[mitch0927]

yeah, me too....could go to McDonalds, get a cheeseburger, fries and a coke and get change back for a dollar....that's how they used to advertise.

[mitch0927]

Stations aren't making profits like a lot of you might think. Sometimes, they lose money just to get you there to purchase other things. Lets invent an owner whose station has a 1000 gallon tank, full of gas. Lets assume that he paid the wholesaler/blender/refiner $1/gallon for that gas, and makes his 1% profit selling that 1000 gallons. That means a hypothetical profit of $10 from selling the gas for $1.01/gallon.

Being that the $10 is his PROFIT, he spends that on groceries and rent. At the end of this transaction, he has gotten back his $1000 in capital, but now has an empty tank. If the price of gasoline has gone up to say, $1.50/gallon, when he calls the wholesaler, he is told:

"Sure, I can come out next Tuesday. Its going to cost you $1500 to fill your tank." Since he has only his $1000 CAPITAL back, he is going to be able to afford only 666 gallons for his 1000 gallon tank, and he is on his way to going out of business.

To be able to afford that increase he is going to need to raise his price on that previous tank just to be able refill again. Lets say that he figures out that the price is going up halfway through that 1000 gallon tank.

He has 500 gallons left to sell, and he needs to raise $1500 CAPITAL, plus still make his PROFIT. Since he has recovered only $500 in CAPITAL and $5 PROFIT, he now needs to sell that remaining 500 gallons for $2/gallon, JUST TO AFFORD THAT REFILL. Plus he still needs to make another $5 PROFIT, so he is really going to have to raise his sale price to $2.01 in order to stay in business and still have his profit.

No business owner would mistake this for SPECULATION.

BLAME WAL STREET.....they are the ones making the big bucks by all the SPECULATION!!!

[rightbehind]

I got all my money out of wall street. I was afraid it would tank. There isn't enough real money on wall street to pay even 10% of the phony baloney number they post from day to day.

[thomderr1]

Most gasoline retailers work under the 'raise quickly, lower slowly' policy. They raise their prices as soon as gas prices go up, even if they paid less for what is sitting in their 4000 gallon tank. They then lower prices more slowly than their cost to insure a bigger profit margin.
No, their profit margins are not great. In Florida, they range from 4% in larger cities to 7% in rural areas, the larger percentage due to less competition.