Gas Prices? Lock That Down!
Pay a little now to save at the pump later
By SCOTT BUDMAN
Updated 6:05 AM PST, Sat, Jun 13, 2009
Oh, if only I had bought Google at $100, or Apple at $13 .. or gas when my local station was selling it for $1.99.
Just in time for summer, we are once again dropping our jaws and opening our wallets wide as we pull into the gas station for a fill up. Oil prices are moving higher by the week, taking gas along with it. But, if public transit isn't in your plans, or the $20,000 to $30,000 for a new hybrid isn't in your budget, we offer relief.
The answer is a gas club, a buying mechanism which offers you a chance to lock in gas prices, so you're not hit by sudden price spikes. Gas buying clubs are starting to take off, thanks both to the Web and driver desperation. It's kind of like the stock market, but with a little less risk.
Generally speaking, you buy gas, locking in that day's price, plus a fee to the club or company you're working with. If the price per gallon goes up, the club gives you back the difference. If it goes down, you pay the lower price, and the club keeps the fee.
We gave Petrofix a try. Headquartered in San Francisco, Petrofix was started by a pair of economics grads who saw an opportunity to target small businesses and consumers, and if the price goes above what you lock in with them, they reimburse you. The Web-based service charges a fee that typically comes out to about 30 cents a gallon, depending on where you live, and how much you use.
Petrofix cofounder Edward Lee says "it allows you to contain gas prices, and control your budget." Yes, to an extent. If the price goes above what you've locked in, Petrofix will refund the difference. But you really only win if gas prices go up big. How often does that happen? If not, you'd save at the pump anyway, and Petrofix still has some of your money. It's a guessing game, not a surefire cost saver. In some sense, what you're buying is reassurance.
There are other, cheaper, choices, too. One, First Fuel Banks (also on the Web), lets you lock in a price, use it for an unlimited time, and ask only for a $1 lifetime membership fee. It's a little like picking a stock: Make sure to do your research first, and be prepared for sudden price moves. if you're looking for a sure thing, buy a train ticket.
First Published: Jun 12, 2009 11:45 AM PST
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