ST. PETERSBURG, Fla. -- National margins for regular unleaded took a stair-step downward this winter, with February's average 19% below year-ago levels, according to the latest C-Store Grab-N-Go research note by Raymond James & Associates.
Regular gasoline margins for the four-week period ending March 2, 2015, fell to an average of 11.4 cents per gallon (CPG), half January's margin on a sequential basis, and sinking to a five-year low for the month of February, according to Raymond James' analysis. It was cut in half sequentially from January, thanks to about a 25-CPG rise in retail gas prices, which followed an approximate 35-CPG jump in wholesale/rack prices.
Diesel margins, while also cut in one-half sequentially from January, still averaged more than 50% higher than year-ago levels, said Raymond James.
Lower retail gas margins in February versus year-ago levels were the norm for all regions of the country. The lowest could be found in the Southeast, where they averaged about 7 CPG, or off 39% year-over-year. This implies, Raymond James noted, that "retailers in the region were capturing only a few pennies of profit net of credit-card fees."
Citing The Pantry and Murphy USA, the analysts observed a 4.6-CPG decline in margins across that region year-over-year, and an 8.8-CPG sequential decline from January to reach 7 CPG for the four weeks ending March 2.
In the Midwest, Casey's General Stores exceeded its February goal of 15.3 CPG by more than 0.5 CPG. Although Raymond James estimates that Midwest regional margins fell almost 20% year-over-year, Casey's management in its latest earnings report noted that its competition quickly increased retail fuel prices as wholesales costs grew, keeping margins relatively healthy.
And in Texas, home to CST Brands and Sunoco LP, fuel margins dipped 3.7 CPG, or off 33% year-over-year, with a 6.7-CPG sequential decline from January to settle at 8 CPG.
Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.