MyGallons Service Lets Users Lock-In Gas Prices

If people did their homework..read the agreement and checked with the BBB, they would know this was a scam. Stupid media just makes the problem worse for not doing thorough research. Company's webpage says it's 100% Money Back Guarantee while their agreement states it's non refundable. SCAM!

How many gallons, must I use a year?? unlimted? Also if the price of gas goes down..what happens??

The bankruptcy and previous corporations of the owner who wants you to buy prepaid gas cards. Escrow accounts are not protected from bankruptcy proceedings mentioned in article www.webofdeception.com

What happens if Mygallons.com goes bankrupt? Is this concept totally sound? Could someone take the money and run? Quite a few years ago, Priceline.com let you bid and buy gasoline but they lost too much money and then there was no more Priceline gasoline.

Scrolling through the sites FAQ answers JOJO question. If you fill up at a price mygallons considers to high for the area they make the appropiate "adjustments" to you account. Read the FAQ and the user agreements carefully, it should give you enough information to make a decision. Also, Bob's comment (below) made a lot of sense to me.

Do not use this service. As "Bob" said earlier, the concept is that that mygallons buys oil futures contracts to offset your purchase. So, they make money if gas goes up or down. If it goes up, they make money on futures contract plus your membership fee. If it goes down, they make money off your initial purchase. You only make money if gas goes up. You are in effect speculating that gas will go up. If you are that sure about gas going up, just buy some oil futures, or oil company stock. Or even maybe going to your corner gas station and buying up like 500 gallons of gas upfront and telling him you'll redeem later. I'm sure they can work something out. Otherwise, you will end up losing money through fees or gas going down. There is no point in putting another middleman in your gas purchases.

I read on their site that if the price of gas goes down, just wait till it goes up again!

MyGallons stays in business by buying futures to back your purchases. They don't really care what happens to the price of gas, the futures contracts take care of that. And they make their $39.99 either way. Anyone can in principle buy gasoline futures on the normal futures market. If you think you'll need 1000 gallons of gas over the next year, and you want to hedge against the price going up --- well, buy a bunch of gasoline futures that will expire at various times over the next year. When those futures expire, you will make or lose money on them proportionate to whether gasoline is higher or lower than when you bought them. Then just go ahead and buy your gasoline at the pump like you normally do. As long as the futures expire at approximately the same rate that you use gasoline, you've effectively locked in the current gasoline price for the future. No need for any MyGallons. Futures have another advantage: you don't have to put all the money up front. If you want 1000 gallons from MyGallons, it will cost you $4000 (or so). 1000 gallons of gasoline futures will cost a LOT less than that, and you put up the money to actually buy the gas later. The cash flow situation of using real futures is much better. Finally, if the cost of gas goes down, MyGallons customers lose their shirt. This is likely to happen. The price of gas usually goes down at the end of the summer. Moreover, we're seeing significant demand destruction now, as people are driving less and buying smaller cars --- and we'll see even more in the future. That will bring down the price of gas as well. Not back to $1/gal, but certainly enough for MyGallons customers who bought their gas at $4/gal to feel screwed. Playing in the futures markets is not for the faint of heart...

Concept is good.... but in practice? Reading through the site, your balance is in 'gallons'..... and you lock in your price for X gallons. So, lets say gas is $3.50 a gallon. You buy 100 gallons for 350.00. Now lets say gas goes overnight to $5 a gallon. You can 'redeem' those 100 gallons for only $350... thus saving $150.00. Now, the gas station does NOT adjust their price down to 3.50 per gallon when you purchase, so WHO eats the $1.50 per gallon at the pump? The mygallons? It would seem that they would ALWAYS be on the 'losing' end if gas was continually going up... how would you stay in business if you were constantly in the RED? They do not say that they own the gas.... it is a 'pre-paid' debit card honored by gas vendors.... It would make MORE sense if Mobile allowed you to 'pre-purchase' gallons at $X per gallon, and then allow you to redeem them at your discretion. You are pre-purchasing from their stockpile actual product... you already 'own' that gasoline.