Gasoline prices in London have fluctuated wildly in the last 48 hours and gas price analyst Dan McTeague says it's happening because some outlets are trying to make a thin profit in a very competitive market.

On Sunday morning, prices ranged from $1.15 a litre to $1.27 per litre. McTeague, of GasBuddy.com, said the 12-cent range represents the profit level that's typical in the London market.

Gas prices in London Monday afternoon ranged from $1.06 per litre to $1.27 per litre.

"Your overhead, generally speaking, takes anywhere from six to 10 cents a litre in a market like London, where real estate is not inexpensive," said McTeague.

But, he added, mass merchandisers such as Loblaws and Costco will sell gasoline at cost and use it as a loss leader to drive sales inside their stores.

Elsewhere, prices tend to go up and down as stations try to stay competitive and grab some profit.

McTeague calls the up and down pricing, "gas bar shenanigans" because "there is no competition at the refinery level."

He said motorists are frustrated by the fluctuations but need to realize retailers aren't making any money selling gasoline for $1.15 per litre.

"In the case of small gas stations, they're either given some support from their supplier, who happens to maybe be a refiner, or they're selling oodles and oodles of potato chips."

McTeague said many convenience stores have taken over traditional gas stations because they can make money selling products in the store and use gasoline prices an incentive.

The landscape has changed dramatically in the gasoline industry from the days of the large refinery-owned gas chains and it's likely to stay that way for the foreseeable future, said McTeague.