May 05, 2020
Tuesday AM

Dear Editor:

With regards to the submission by my "My Good friend" as politicians often begin their opposition view, Marvin Davis on the subject of local fuel prices.

He is totally correct in his presentation, I can attest to that as a past employee of a major oil company in Ketchikan, to the pricing logic.

However, think clearly. When the prices increase, there is no selling off the inventory of cheaper product till the volume is depleted as the reverse of what Marvin  has presented . Prices go up immediately on current inventory well before the barge with cheaper fuel arrives.

This is not to bitch, it is reality. when the price goes down then the inventory on hand at the higher price paid for it has to be sold off before the benefit of the lower product is posted. When the price increases, the increased cost is applied to the current remaining inventory.(Phantom Profit) This happens all down the trail to the service stations who in actuality have little control, roll with the supplier's actions.

A second important factor is competition. We really don't have any in the fuel supply department to any extent.

That is a capitalism reality folks.

A.M.Johnson
Just wanted to clarify. 
Ketchikan, Alaska

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Editor's Note:

The text of this letter was NOT edited by the SitNews Editor.

Received April 28, 2020 - Published May 05, 2020

Related Viewpoint:

Local comments on fuel prices By Marvin Davis

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