Florida gas prices are declining again after surging during the past two weeks. The state average declined almost 2 cents per gallon over the weekend, but more discounts are likely on the way, according to AAA.
“Gas prices soared in recent weeks, after winter storms caused temporary refinery outages,” said Mark Jenkins, Public Relations Manager for AAA – The Auto Club Group. “Last week, we saw fuel prices retreat again, as refinery activity ramped back up and the market turned bearish on global fuel demand, due to rising cases of Covid-19 in China. Retail prices could drop 10-20 cents in the coming weeks, unless oil prices suddenly rebound.”
On Sunday, the state average was $3.30 per gallon. That’s 10 cents more than this time last year. In 2022, gas prices reached a new record high of $4.89 per gallon in June. The 2022 low was set on December 26th at $2.99 per gallon.
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Gas prices declined through the end of November and much of December. The state average dropped 59 cents per gallon, over the course of six weeks. The state average then rebounded 32 cents per gallon in the final days of 2022 and into 2023.
Oil prices remain the key factor in what drives prices at the pump. About half the price of gasoline is set by the price of oil. When gas prices plunged in early December, the U.S. price of oil had fallen from $92 per barrel to $71/b.
During the final week of 2022, oil rebounded to $86/b and dragged gas prices up to $3.31/g.
The good news for drivers is oil prices plummeted again last week, right back down to the low 70s. This should enable gas prices to drop too.
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“Don’t expect significant discounts at the gas pump overnight,” Jenkins said. “Gas prices always rise like a rocket and fall like a feather. That’s because retailers often prefer to offload the more expensive gasoline first, then wait for their next delivery before lowering prices. So it could take a few weeks before retail prices fully adjust to the recent oil price drop. And that’s assuming that oil prices don’t change course between now and then.”
On Friday, the closing price for U.S. oil was $73.77 per barrel. That’s a 15% drop from the week before.
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