Cheap gas ending as forecast calls for average to hit $3 in Palm Beach Co.

Gasoline prices are on the rise and expected to peak at $3 to $3.35 a gallon this spring.
Gasoline prices are on the rise and expected to peak at $3 to $3.35 a gallon this spring.

Say goodbye to cheap gasoline and hello to $3 a gallon for regular gasoline in Palm Beach County this spring.

GasBuddy forecasts that 2017 will bring the highest gas prices in three years. Motorists will shell out $53 billion more over the course of the year compared to 2016, as the national yearly average rises to $2.49 a gallon. In 2016 it was a mere $2.13 a gallon.

For Palm Beach County, which almost always has the state’s highest prices, and the rest of the nation,  gas prices are forecast to  reach a peak in May.

“For Palm Beach County, it would be reasonable to expect prices to peak in May between a range of $3 to $3.35 a gallon,” GasBuddy senior petroleum analyst Gregg Laskoski said. “Summer will be fairly high, and when we get into the fourth quarter, we expect prices to decline, which is pretty much what we see every day.”

Thursday, Palm Beach County’s average was $2.52 a gallon for regular, up from $2.30 a month ago. That’s well above Florida’s $2.41 average and the nation’s $2.35, according to AAA’s Fuel Gauge Report.

AAA has forecast that Florida’s 2017 average will range from $2.25 to $2.75, AAA spokesman Mark Jenkins said Thursday. Some metro areas are likely to have stations selling gas above $3 a gallon.

The seasonal switch from winter-blend to summer blend fuels as mandated by EPA and the Clean Air Act will bring a spike at the pump later this spring, GasBuddy said.

Crude oil and gasoline prices have been pushed up in recent weeks following an announcement by OPEC and non-OPEC countries that they will cut back oil production by 1.8 million barrels a day this year.

“While gasoline prices nearly always follow the same direction as crude oil and represent an important barometer for consumers and their personal  budgets, the increases we anticipate this year may be met with less resistance than in the past if economic improvement softens the blow,” Laskoski said.

“If the Trump Administration delivers on its promises; lower taxes, more jobs, higher salaries and savings, then….then a concurrent increase in demand and gasoline prices may be easier to digest,” Laskoski said.

Of course, as with any forecast, there’s a lot of room for error. Additional components that have the potential to weigh on retail gasoline prices include federal and/or state tax changes, Middle East volatility, currency fluctuations, refinery maintenance and/or unscheduled outages, weather events and shipping/transportation snafus, GasBuddy said.

Now for the lingering question. Why are Palm Beach County’s gas prices the state’s highest? Thursday, that held true, as the county’s $2.52 average surpassed the next highest, Broward County,  by 5 cents.

A number of factors are blamed for Palm Beach County’s high gas prices, including its distance from Port Everglades in Hollywood and the Port of Tampa, where gasoline is delivered on tanker ships.  Also coming into play are highest allowable gasoline taxes, stations charging what the market will bear and strict zoning that limits the number of gas stations in some areas.

To read more about why prices are even higher in cities such as Jupiter, click here.

 

 

 

 

 

 

 

 

 

 

Gas prices up 7 cents in wake of OPEC, non-OPEC oil cutback pledges

Gasoline prices are moving upward following announcements by oil producers.
Gasoline prices are moving upward following announcements by oil producers.

Palm Beach County’s average for a gallon of regular rose 7 cents in the last week to $2.37 Monday, AAA’s Fuel Gauge Report shows.

The upward trend is expected to continue as the petroleum futures market reacts to oil production cutbacks announced by both OPEC and non-OPEC nations.  The cutbacks, aimed at raising oil prices and boosting the energy industry,  aren’t expected to start until January.

Florida’s average for a gallon of regular stands  at $2.21 Monday, up from $2.18 a week ago.

The lowest priced gas reported locally Monday on GasBuddy.com is $2.07 a gallon at Exxon, 3066 N. Military Trail hear Community Drive in West Palm Beach.

Lowest prices reported as of noon Monday for the following cities are:

Jupiter: $2.28, Marathon, 5490 N. Military Trail and Donald Ross Road

Palm Beach Gardens:$2.29, Sunoco, 9772 State Road 811/Alternate A1A and Lighthouse Drive

Wellington: $2.33, Marathon, 2741 State Road 7 near Pierson Road

Lake Worth: $2.13, J&A, 4703 S. Military Trail and Melaleuca Lane

Boynton Beach: $2.15, BJ’s Wholesale Club,  1540 W. Boynton Beach Blvd.

Delray Beach: $2.21, Valero, 1001 S. Congress Ave. and SW 10th Street

There’s a mix of potential upward and downward forces at work simultaneously on crude oil prices, said Gregg Laskoski, senior petroleum analyst for GasBuddy.

“On the one hand we have the news that OPEC issued over the weekend: that a group of non-OPEC oil producers led by Russia have agreed to collectively cut 2017 production by 600,000 barrels,” Laskoski said.

“But on the other hand, the promises for next year do little to change the robust global supply we have today. OPEC’s November output rose 370,000 barrels per day to 34.19 billion, a record high. Reuters reported that Russian oil production for November also set a new record. Nobody’s saying anyone will cheat on the agreement, but old habits are hard to break.”

Monday, global oil prices were up almost 8 percent to $57 a barrel.

Other countries pledging to reduce production include Mexico, Azerbaijan, Bahrain, Oman and several other small producers, AAA said.

OPEC recently announced its members would cut back production by 1.2 million barrels a day.

The oil market has been oversupplied since 2014, AAA said. That year oil prices plunged below $90 a barrel and haven’t returned since.

 

 

 

Gasoline prices rise as oil reaches 17-month high, AAA says

Gasoline prices are on the rise.
Gasoline prices are on the rise as oil trades higher.

Gasoline prices are still rising after OPEC members agreed last week to reduce crude oil production by 1.2 million barrels a day, and the increase is expected to continue, AAA said.

Futures prices determine the price of oil, even though supplies are still ample. Last week crude oil prices reached their highest level since July 2015, with a barrel of WTI settling at $51.68 Friday on the NYMEX $6.45 higher than on Tuesday. Wholesale gasoline prices rose 13 cents last week.

Monday, Palm Beach County’s average for a gallon of regular reached $2.30, up from $2.25 a week ago. Florida’s average is $2.18, up from $2.09 a week ago.

While AAA has forecast that gas prices could rise a total of 10 to 15 cents in the near term,  the increase could be even more.

“How the market responds this week could send prices even further,” said AAA spokesman Mark Jenkins. “It’s unclear how much more upside momentum oil prices have, but some analysts believe they could eventually reach $54 a barrel. If that happens, the rise in pump prices could reach a quarter.”

The impact of OPEC’s actions remains uncertain as there has been an issue in the past with member nations failing to cut  back production as promised.

Patrick DeHaan, senior petroleum analyst for GasBuddy, said Monday, “If I had a nickel for every time OPEC said it was going to cut oil production, I could probably buy everyone free gas on Christmas.

“While OPEC signaled at its meeting in Vienna that it would cut crude oil production, it also created a committee to monitor the reduced production quotas- addressing the issue of cheating- an issue that has been pervasive for the organization. For now, oil markets have bid up oil prices in a fury believing the agreement, which comes in to force in January, is exactly what’s needed to balance supply and demand. I, however, believe this rally represents a balloon that’s filled with too much air and risks a correction (popping the balloon) that may be seen in due time,” DeHaan said.

“But as I wait for the balloon to burst, the rally in oil prices will lead to higher gasoline prices in much of the country over the next couple of weeks as prices catch up to the feverish rise in oil prices. From the east to the west, average prices could rise 5-15 cents a gallon in the week ahead, so motorists should plan accordingly and expect in nearly all communities. OPEC seems to be taking the role of the Grinch this holiday season: the era of low oil prices may be over for now,” DeHaan said.

Gasoline prices shoot up overnight due to OPEC’s planned cutbacks

Gasoline prices are on the rise.
Gasoline prices are on the rise.

December gas prices are off to a roaring start as the average price for a gallon of regular unleaded rose 3 cents overnight in Florida to $2.15,  AAA said Thursday.

Palm Beach County’s average jumped 2 cents overnight to $2.28, according to AAA’s Fuel Gauge Report.

Pump prices are climbing in response to OPEC ’s announcement that it would cut crude oil production by 1.2 million barrels, in an attempt to reduce global glut and raise oil prices.

Crude prices rose more than $4 a barrel, following the announcement on Wednesday. Oil is currently trading above $50 – the highest in more than a month. Rising oil prices makes the cost of producing gasoline that much higher, so gas prices climb too. Wholesale gasoline rose 10 cents yesterday, making it more expensive for retailers to purchase gasoline; a higher cost that is typically passed along to the consumer, AAA said.

“We usually see declining gas prices in December because of low demand, but this year prices should be more volatile,” said AAA spokesman Mark Jenkins said.

“The market is currently buying-in on the OPEC news, which could cause gas prices to jump 10-15 cents in the next week and a half,” Jenkins said. ” How long this trend continues will depend on where oil prices go from here. Some analysts believe higher prices will be difficult to sustain, as non-OPEC countries may be enticed to cash-in by ramping up production, thus leading to even more glut, and sending prices lower as a result.”

Traditionally, December lower gas prices. Pump prices for the 12th month delivered discounts four out of the last five years. Prices declined a total of 6 cents in December 2015. December 2014 saw prices decline a whopping 41 cents, as oil prices tanked from $69 a barrel to $53 and haven’t returned since.