How GasPredictor.com's Houston Gas Predictor Newsletter Saves You Money

On this page:

• The Bottom Line
• Description of the test scenario
• Highlights of the test
• Table showing day-to-day events

The Bottom Line of the Test

Our subscriber paid $761.92 for gas since 3/9/2009. Our control driver paid $749.89. Our subscriber is ending the test with 8 more gallons of gas in his tank than the control driver has. The extra 8 gallons in the subscriber's tank is worth $18.87. Subtracting that from the amount he spent for gas means that he spent $6.84 less than the control driver did. Extrapolating this savings over a full year (262 business days) yields an annual savings of $10.01.

Following our recommendations would save you $10.01 per year, or $5.42 more than the cost of a one-year subscription to the Gas Predictor Newsletter.

Note: We began publishing our Houston Gas Predictor on March 9, 2009, so this test does not encompass an entire year of predictions.

And as a bonus, you get to smirk when you see the price go up and you knew it was going to go up. No extra charge.

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Description of the Test Scenario

This test compares two hypothetical drivers, the "subscriber" and the "control driver." Each has a car with a 14 gallon tank, each uses exactly two gallons of gasoline every business day, and each has just filled his tank the evening of March 8, 2009.

Our "control driver" does not subscribe to the Gas Predictor Newsletter. He simply leaves his gasoline budget to chance. He fills his tank whenever he gets home from work with only two gallons in the tank. Thus, he buys 12 gallons of gas every sixth business day, without regard to the cost. This represents the way most people buy gas, and shows how much a hypothetical driver would pay for gas without the benefit of our Gas Preditor.

On March 9, our "subscriber" begins receiving his Houston Gas Predictor Newsletter by e-mail. Each night, he tries to follow our recommendations, even though he can not always do so. If we recommend buying gas that day, he fills his tank, even if he just filled it the night before. If we recommend holding off and buying gas the next day, he does not buy any gas unless his tank is absolutely empty. If his tank is empty, he buys four gallons of gas, to get him through the next couple of days, and yet leave enough room in his tank that he can take advantage of any buying opportunity that our newsletter recommends.

We recognize, of course, that this test is not quite realistic in several ways. For one thing, nobody uses exactly two gallons of gas every single day. And nobody drives their car only to work, not driving at all on non-business days. Nobody has off every day that the NYMEX commodity exchange is closed. Nobody buys gas by the gallon, instead rounding up to the next dollar or otherwise easy amount of money to enter in their checkbook (or to make change, if they're paying in cash). And even though our predictions are perfectly wonderful, we're sure none of our subscribers would bother to buy just two gallons of gas because we recommended it. (No, even we don't do that.) However, we had to come up with fixed, simple rules in order to make the test a fair comparison between using our predictions and not using them.

For this test of the Houston Gas Predictor Newsletter, the price of gas used is the second-lowest price for unleaded regular gasoline in the Houston area at about 4:00 PM Central.

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Highlights of the Test

• During the entire period April 3 through November 18, the control driver bought gas 26 times. By amazing coincidence, 22 of these times were also days when we recommended buying gas. He just got lucky! A slightly different turn of luck and our subscriber's savings would have been even greater.
• The dates when the control driver bought gas on days when we recommended buying gas were April 9, April 20, April 28, May 6, May 14, May 22, June 2, June 10, June 18, July 15 (the day we were wrong anyway), July 23, July 31, August 10, August 18, September 14, September 22, September 30, October 8, October 16, October 26, November 3, and November 11.
• April 7: Our subscriber buys gas at the exact bottom of a price dip. Prices had declined 2 cents per gallon that day, and would increase 4 cents per gallon the next day.
• April 20: Our subscriber fills up at the bottom of a price dip. Prices had declined 3 cents per gallon 4 days before, and would increase 4 cents per gallon the next day. By coincidence, the control driver also bought 12 gallons that day, realizing the same savings.
• May 8: The largest one-day price increase during this period, 8 cents per gallon. Our subscriber has been keeping his tank full, as pressure has always been upward ever since April 20, so he only buys 2 gallons of this more expensive gas.
• May 14: In the middle of a prolonged run of upward pressure (though not much in the way of actual price increases), both the subscriber and the control driver have full tanks. However, the control driver spent $24.71 to fill up, while our subscriber had only spent $24.03 buying gas every day since the last time they both had full tanks. At that rate, 68 cents per 6 business days, our subscriber's savings for a whole year would be $29.69 per year.
• June 26: One of the few times the control driver bought gas on a day we recommended not to buy. Gas had increased 2 cents per gallon that day, and would decrease 4 cents per gallon the next day. Either way, it was an awful day to fill up. Our subscriber didn't!
• July 10: During a long run of downward pressure, our subscriber must buy 4 gallons of gas on a day we recommended not to buy. Even so, he is spending 10 cents per gallon less than the last time he bought gas, on June 30.
• July 15: This is the day our Houston forecast was incorrect. On our recommendation, our subscriber filled up with 12 gallons of gas, paying a whopping 7 cents per gallon more than he would have paid if we had correctly recommended to hold off and buy gas the next day. By unfortunate coincidence, this was the largest single-day price decrease in Houston during this period. But by another coincidence, the control driver also filled up this day. Neither driver was able to take full advantage of the next day's bargain, but at least the subscriber knew to top off.
• July 23: After a run-up from the lowest prices of the summer, both the subscriber and the control driver have full tanks. The control driver spent $25.91 to fill up this day, but the subscriber has only spent $25.45 to keep his tank full for the past 6 business days. At this rate, 46 cents per 6 business days, our subscriber's annual savings would have been $20.09.

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Table of Day-to-Day Events in the Test

Key

• Date - The date we issued this prediction, pertaining to the next business day.
• Buy Today? - Did we recommend buying gas that day ("yes"), or waiting to buy gas the next day ("no")?
• Avg. Price - What was the second-lowest gas price in Houston? This is the price on the date given, not the predicted price for the next day.
• Sub. Gas in Tank - How much gas did our subscriber have in his tank at the end of that day, when he received his Gas Predictor newsletter?
• Sub. Bought - How much gas did our subscriber buy that day, whether we recommended it or not?
• Sub. Paid - How much did our subscriber pay for the gas he bought that day?
• Ctl. Gas in Tank - How much gas did our control driver have in his tank at the end of that day?
• Ctl. Bought - How much gas did our control driver buy that day?
• Ctl. Paid - How much did our control driver pay for the gas he bought that day?

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