A Quarter to Remember

Record third-quarter fuel margins put retailers flush for 2015

ST. PETERSBURG, Fla. -- Third-quarter 2015 was a very, very good time to be a fuel retailer.

caseys gas

According to the latest C-Store Grab-N-Go research note by Raymond James & Associates, St. Petersburg, Fla., national retail margins for regular gasoline hit around 27 cents per gallon (CPG) for the third quarter, a 10% jump over the same time period a year ago.

Retail margins were up 70% sequentially from second-quarter 2015, thanks to a big drop in wholesale prices.

Raymond James analysts sorted through third-quarter financial results for chains in a coverage area that includes Casey’s General Stores, CST Brands, Murphy USA, CrossAmerica Partners, Sunoco LP and TravelCenters of America.

Retail regular gas margins for August were 40% above year-ago levels, and September’s were 14% higher. Retail gas margins varied from 17 to 40 CPG from July through September, but spent most of their time above year-ago levels in the last two months of the quarter, thanks to a 30% drop in Gulf Coast wholesale gasoline prices.

On a regional basis, the Midwest—home to Ankeny, Iowa-based Casey’s—enjoyed the strongest jump, up 17% year-over-year for the quarter. The Southeast was close behind with a 16% increase in retail regular gas margins, favoring retailers such as El Dorado, Ark.-based Murphy USA. Texas, where San Antonio-based CST Brands and Corpus Christi, Texas-based Sunoco do business, saw margins up 7%. In the Northeast, relevant to Bethlehem, Pa.-based CrossAmerica Partners, third-quarter retail margins rose 4% year-over-year.

And in good news for travel-center chain TravelCenters of America, Westlake, Ohio--national retail diesel margins for the third quarter leapt nearly 30% over year-ago levels.

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