After setting record, when will Florida gas prices drop?

The cost of the average gallon at the pump is inching closer to $5, AAA says.
The price for a regular gallon of gasoline is posted at a Sunoco gas station located at the corner of 16th Street N and Central Avenue on Monday, June 6, 2022 in St. Petersburg. AAA is predicting that the price for a regular gallon of gasoline in Florida could hit $5 this summer.
The price for a regular gallon of gasoline is posted at a Sunoco gas station located at the corner of 16th Street N and Central Avenue on Monday, June 6, 2022 in St. Petersburg. AAA is predicting that the price for a regular gallon of gasoline in Florida could hit $5 this summer. [ CHRIS URSO | Times ]
Published June 7, 2022

The price of gasoline is breaking records again.

The average cost for a gallon of regular unleaded fuel in the Tampa Bay area and Florida reached a new height on Monday at $4.76, according to data from AAA The Auto Club Group. Experts warn that it could reach $5 this summer.

“Right now, gas prices appear to be on an upward trajectory with very few options for relief,” said AAA Florida spokesperson Mark Jenkins.

It’s hard to say how high prices will go in the coming weeks and months, Jenkins said. It’s become increasingly harder to predict, he said, because of the international backlash against Russia’s invasion of Ukraine and the pandemic’s effect on supply and demand for oil.

After the European Union announced it will ban 90% of Russian oil by the end of the year, the oil futures market — where people speculate on the price of the commodity like the stock market — saw prices jump significantly last week. Shanghai also reopened from a COVID-19 lockdown, increasing demand for gas at a time when oil production is still down from pre-pandemic levels. Oil companies can’t ramp up production fast enough to meet travel’s rebound, Jenkins said.

“It’s not a situation where you can just flip the switch and oil production just comes right back to where it was,” Jenkins said. “The good news is that production is increasing.”

The price of gas in Florida is up 66% from 2021, AAA data showed. Drivers across the state are paying around $71 to fill a 15-gallon tank, which is about $29 more than they did this time last year.

Even as prices soar, it’s not stopping people from driving — yet. Gasoline demand is up 2% from a year ago, according to the U.S. Energy Information Administration. Memorial Day travel was “robust” and the high costs haven’t hurt demand yet, according to AAA.

“People are still willing to pay the higher price in order to travel and do the things that they enjoyed doing before the pandemic,” Jenkins said.

But once the price hits $5, 80% of drivers would change their habits to save money, AAA found in a recent survey. The majority of respondents said they would drive less or travel shorter distances. Some would combine trips.

Higher gas prices do have “a positive impact on ridership increasing on public transportation,” said Pinellas Suncoast Transit Authority spokesperson Stephanie Rank, with fixed-route ridership increasing 3.7% from April to May. That does mean added fuel costs for the agency, but for now, that cost isn’t being passed on to riders.

“Riding public transit instead of driving your car can quickly save you hundreds of dollars,” Rank said. “A monthly pass on our Flamingo Fares can be $70 versus some people having to fill up their tank for $70 once per week.”

Meals on Wheels of Tampa runs about 95 food delivery routes per day, each of which feeds 10 to 14 people. And there are enough homebound, disabled or elderly people out there that the nonprofit could add another 10 or so routes tomorrow.

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The problem would be finding volunteers willing to drive them.

Related: Those spiking gas prices have Meals On Wheels hurting for volunteer drivers

“They use their own car and gas and time and kindness to deliver those meals,” said Steve King, the group’s executive director. “The overall feeling of gas increasing has caused many who might be volunteers for us to wonder if they should or not, because of the rising prices. So it definitely impacts our volunteer base, which ultimately are the people that deliver the meals to those we serve.”

Volunteer drivers for nonprofits like Meals on Wheels are eligible for a tax reimbursement of 14 cents per mile, unchanged from 2021, according to the Internal Revenue Service. That’s well below the past year’s price hikes.

The cost to fill one of the trucks for a Sarasota-based mobile menswear shop has doubled since prices skyrocketed earlier this year, said Tweeds Suit Shop owner Donald Carlson. Tweeds Suit Shop travels to customers to create made-to-measure suits, and the business expanded into Tampa Bay last September. Carlson said they’ve had to rearrange client bookings to be closer together. Inflation has also pushed fabric costs up, and he said he’s had to raise prices.

“The fact that we use trucks that run 8 miles to the gallon, it’s definitely a higher expense than we’re used to,” Carlson said.

Paying nearly $5 at the pump is a lot already, he said, adding that he hasn’t had to cut back or limit how far to travel for appointments. But Carlson said he’s worried if the trends continue.

“If gas prices got to $10 a gallon, that would be crazy,” Carlson said. “We just have to be more strategic on how we run appointments and we’ve got to sell more suits.”

AAA’s Jenkins said it would take a “seismic shift” for gas prices across the state to drop soon, whether it be a resolution to the war in Ukraine or prices getting so high that it compresses demand. There’s also speculation of a recession, which would hurt demand and could cause prices to fall. Florida lawmakers passed a gas tax break that could help Floridians save 26 cents per gallon, Jenkins said, but that won’t take effect until October.

Related: Sales tax holidays, gas tax exemption: what’s in the tax package DeSantis just signed

For now, Jenkins expects prices to keep going up.

“After the summer driving season, demand begins to taper off and prices generally would follow,” Jenkins said. “But right now, things are just all over the board.”