Lower gas costs in Topeka chalked up to price wars

Per gallon rate in capital city below state average

Kyle Griggs, of Lawrence, pumps gas while talking to his friend, Bione Dudley, of St. Louis, at the BP gas station at 23rd and Louisiana streets.

An unusual gap has developed between gas prices in Lawrence and Topeka this week.

Prices in Topeka are well below the state average and Lawrence’s are remaining steady.

The AAA Daily Fuel Gauge Report listed the average gas price in Lawrence on Friday at $2.98 per gallon – almost exactly the state average. Topeka’s average was $2.86.

But prices in Topeka on Friday went as low as $2.69, while Lawrence prices were around $2.90 and above.

“That’s a pretty good-sized difference for two communities that close to each other,” said Jim Hanni, executive vice president for AAA Kansas.

Hanni noticed the difference between Lawrence and Topeka prices earlier this week. A month ago, according to the AAA Daily Fuel Gauge Report, both cities’ prices were right around $2.95.

Marvin Speers, president of Topeka gasoline wholesaler Capital City Oil, chalked up the price difference to price wars between Topeka gas stations. He guessed that many Topeka stations were selling gas at below cost.

“Probably some knucklehead in Topeka dropped the price below where it should be,” Speers said. “That’s probably the short answer. We’re the only industry that’s stupid enough to put the price out there in 2-foot-high numbers.”

Speers said wholesale gasoline prices went up about 2 to 3 cents Friday night, and he predicted the Lawrence-Topeka price discrepancy might be over by sometime today.

Scott Zaremba, owner of seven Zarco 66 gas stations in Lawrence and Olathe, said price wars could be triggered when large, corporate-owned chains lower gas prices to attract customers into their convenience stores.

“You have to stay competitive with whatever the market price is in your area, even if it means you lose money,” Zaremba said. “People will go a long way for just a penny or two.”

Bryan Hunter of Lawrence filled up Friday afternoon at the Star Foodmart station at 501 W. Ninth St., where regular-grade gas was $2.95 per gallon.

Hunter said he could make little sense of the price difference between Lawrence and Topeka, or of gas prices in general. But he said he noticed that Lawrence prices tended to change in unison.

“It’s always kind of suspicious when everyone in town changes all at the same time,” Hunter said.

Speers said stations often used copycat techniques to determine gas prices.

“They think that they’re going to gain a big advantage by dropping the price,” he said. “But the other guy’s going to follow just as soon as he gets his ladder out.”