Researchers Find No Valid Reasons for Varying Gas Prices from Region to Region

JULY 13, 2004 - Posted at 7:27 a.m. CDT

FAYETTEVILLE, AR - A University of Arkansas researcher has concluded from a study that variance in gasoline prices from region to region is not a reason for higher overall gas prices.

UA professor Gary Deck and a George Mason University professor found that a standardized pricing system would lead to higher overall prices at the pump.

Oil companies set prices using a complex zone system based location, demographics, competition, traffic counts and area real estate values.  The zones account for prices swings at stations owned by the same company in the same city.

The study says uniform pricing would eliminate incentives for competing gas stations to try to undercut each others' prices.

(Copyright 2004 by The Associated Press.  All Rights Reserved.)