No Holiday for Gas Prices
By Arlene Satchell, South Florida Sun-Sentinel
Nov. 15–South Floridians and consumers nationwide planning car trips for the Thanksgiving weekend should expect to pay more for gas.
Gas at the pump is within striking distance of May’s all-time national record of $3.227 a gallon for unleaded regular, having reached $3.111 on Wednesday, according to AAA.
Across South Florida, consumers face average prices of $3.15 to $3.22 a gallon for regular gas, according to the AAA’s Fuel Gauge Report.
Reaction to the price spike the past couple of weeks ranged from resignation to shell shock as residents filled up their vehicles Wednesday afternoon.
For Lauderhill resident Theresa Brown, riding the bus to work could be an option if gas prices continue soaring.
“I’m actually considering incentives my work offers for public transportation,” said Brown, who works for the Social Security Administration.
Fred Rozell, retail pricing director at the Oil Price Information Service, said gas may rise another 10 to 15 cents a gallon on average nationwide in the coming weeks as it catches up with oil prices that have soared close to $100 a barrel.
The West Palm Beach-Boca Raton metropolitan area posted an average Wednesday of $3.22 a gallon for regular gas, 10 cents higher than last week’s prices. In the Fort Lauderdale metro area, the average price hit $3.15 a gallon, up from $3.04 last week.
High gas prices like these were last seen in mid-May, AAA Auto Club South spokesman Randy Bly said.
And a weak U.S. dollar, rising crude oil prices and talk of lower supplies at oil refineries have continued to drive prices.
“We’re becoming less optimistic that prices could relax at this point,” Bly said.
Oil futures, meanwhile, rebounded Wednesday after a sharp decline the previous session as investors started questioning whether OPEC will increase production. Light, sweet crude for December delivery rose $2.92 to $94.09 a barrel on the New York Mercantile Exchange after a $3.45 drop Tuesday.
Americans are starting to feel more pain from fuel costs because they are rising as a percentage of income. According to an Oil Price Information Service study released Wednesday, it costs 3.8 percent of median U.S. household income to fuel a single vehicle, up from 1.9 percent in 2002.
South Florida percentages exceed the national average.
In Broward County, the average household spends 4.27 percent of median income to fuel each vehicle, and in Palm Beach County, it costs the average household 4.03 percent of median income to fuel each vehicle.
Sunrise resident Marcelo Giuras, 36, spends $350 to $400 a month to fuel two family vehicles.
Giuras, who works two jobs to support his family of five, has resigned himself to the higher prices.
On Wednesday he spent $53.10 on super-premium unleaded gas to fill up his 2007 Saturn Aura at $3.38 a gallon.
Rozell thinks consumers are starting to cut back on their driving.
“Retailers that I’ve been talking to have been saying that demand … is down or flat,” Rozell said, predicting that demand for gasoline will fall first in the South and Midwest.
With geopolitical events still churning in the Middle East, oil market volatility could increase.
But with Thanksgiving a week away, Bly doesn’t expect holiday plans to be thwarted.
“People should realize they’re going to pay more out-of-pocket and they’ve got to budget, make adjustments to offset the rising costs,” Bly said.
Crude’s rebound Wednesday again raised the prospect that prices could rise to $100 a barrel, or higher. Oil peaked at $98.62 last week.
Prices rose Wednesday after OPEC Secretary General Abdalla Salem el-Badri said there is no need for the Organization of Petroleum Exporting Countries to add more oil to the market.
Oil prices fell earlier this week in part because of comments by Saudi Arabia’s oil minister suggesting that the cartel will discuss raising production at a meeting next month.
Meanwhile, the dollar slipped on Wednesday, driving investors back to crude futures. Oil futures offer a hedge against a weak dollar, and oil futures bought and sold in dollars are more attractive to foreign investors when the U.S. currency is falling.
Information from The Associated Press was used to supplement this report.
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