Supply Shortages Continue Pumping-up Gas Prices

| March 31, 2014

Gas-Prices-Upward-Graphic TAMPA, FL – The national average for gasoline inched up 2 cents in the past week. Typical spring factors like refinery maintenance, increasing demand and the switch to summer-blend fuel remain part of the story.

In the past seven days, the average price for a gallon of gasoline rose 5 cents in both Georgia and Tennessee. However, the most expensive prices in the southeast are found in Florida, where the average price is $3.63, 8 cents higher than the national average and 7 cents higher than last week.

“Florida motorists are seeing the highest gas prices since July,” said Mark Jenkins, spokesman, AAA – The Auto Club Group. “While Florida prices could continue inching up, they are still well below last year’s peak of $3.88 and not expected to reach $4.00 a gallon.

Gas prices in Florida are increasing more than other states because of supply issues and strong demand. Unlike other states, the majority of Florida’s gasoline is delivered by ship instead of pipeline. According to the Energy Information Administration, imports have dramatically declined, during recent years, due to refinery closures in the Caribbean and limited shipments from refineries in the Gulf of Mexico that would otherwise be able to offset the shortage. Now, anytime gasoline demand spikes, retailers must engage in a bidding war with the New York Harbor for shipments from the Atlantic basin to prevent a shortage.

The EIA also states that gasoline consumption in Florida typically peaks in March, when seasonal population is high and spring break travelers and baseball fans arrive. This pattern differs from other states, where gasoline consumption typically peaks in July and August and is lowest during the winter months.

Meanwhile, multiple factors continue putting upward pressure on oil prices, which influence about two-thirds the price of gasoline across the country. Consumer spending in the U.S. rose to the highest level in three months and continued conflict between Russia and the Ukraine heightens concerns of a supply disruption.

“Oil prices are expected to continue trending upward this week, which could mean more pennies per gallon at the pump,” said Jenkins.

CURRENT AND PAST PRICE AVERAGES

Regular Unleaded Gasoline

Current Week Ago Month Ago Year Ago
National $3.55 $3.53 $3.45 $3.64
Florida $3.63 $3.56 $3.46 $3.64
Georgia $3.42 $3.37 $3.30 $3.51
Tennessee $3.42 $3.37 $3.30 $3.51

Source: AAA

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3 Comments on "Supply Shortages Continue Pumping-up Gas Prices"

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  1. RC says:

    None of us should overlook the inflation component. Crude oil in the vast majority of commodity markets is “tagged to the dollar”. Since the Federal Reserve has been adding more dollars into the economy (in unprecedented quantities), the commodity markets have done what they naturally do – they have raised the price of crude. The basic rule of thumb is this; when more dollars are chasing something (anything), the price will go up – the opposite is also true; when fewer dollars are chasing something the price will go down. Unfortunately for us, the very same people who are causing all of us this pain and discomfort, are saying that inflation is currently a non-issue. For those of you who like myself, are hearing one thing but experiencing another, I highly recommend checking out the info at shadowstats.com. There is one other thing I would like to add, when I fill-up my gas tank with my salary; it hurts. But, if I were to fill it up with Janet Yellen’s salary (our Federal Reserve chairman), I’m quite sure it would not be nearly as painful.

  2. Jim Parker says:

    You and I pad the bottom line profit of these oil companies that don’t have to pay a dime in taxes to the US government. We, taxpayers, kick back billions a year from the US Treasury to them.

    I don’t believe for a moment that there is any scarcity of product that’s not artificially created. If there was, that would mean you couldn’t obtain it. I have never not been able to obtain gasoline in over forty five years of driving.

    This is all about these companies increasing their profit margin during the time of greatest demand for their product. It’s happened every year for a very long time.

  3. RC says:

    Here are several oil companies who have paid taxes. This info can be found on usatoday.com.

    ExxonMobil’s income tax bill for 2012 was: $31.05 billion dollars.
    Chevron’s income tax bill for 2012 was: $20.00 billion dollars.
    ConocoPhillips’ income tax bill for 2012 was: $7.94 billion dollars.

    All of the above taxes were treated in the same way ALL other businesses treat them; they pass them onto their customers. With that said, it looks clear to me that the real problem is “statism”. The dictionary defines statism this way: it is the “concentration of economic controls and planning in the hands of a highly centralized government.” With that in mind; the statist working at the IRS does not care where the revenue comes from (in this case you and I), he only cares about the dollar amount that must be paid. And so, like the IRS the Federal Reserve has many (and I do mean many) statists on the tax payer’s pay roll!