Despite an international deal announced Sunday to limit oil production, gasoline prices continue to free fall in the state and across the country, reaching an average of $1.85 per gallon in Florida Sunday.
That average is 6 cents lower than the previous week, 56 cents lower than late February, and 95 cents lower than the third week in April of 2019, according to AAA — The Auto Club Group.
According to AAA, 91% of Florida’s stations now are selling gasoline for less than $2 per gallon.
On Sunday, OPEC and its allies agreed to cut oil production by 9.7 million barrels per day — the single largest output cut in history.
This effectively ends a price war that broke out between Saudi Arabia and Russia, which caused an overnight 25% reduction in oil prices last month. From there, the downward trend continued as the effects of the coronavirus impacted the global economy and forced Americans to stay off the road.
In total, oil prices are down 56% since February 21.
During that time, the price of crude plummeted from $53 per barrel to $23 per barrel. Florida gas prices also dropped 56 cents. This deal is an attempt to help eliminate supply surpluses and strengthen the price of crude.
“The OPEC deal should not cause gas prices to suddenly spike, but it will affect how low they can go,” Mark Jenkins, spokesman, AAA — The Auto Club Group, stated in a news release. “Wholesale gas prices suggest the state average could eventually reach $1.50 or below, but that won’t happen if oil prices gain upward momentum.”
Then again, few people are able to take advantage of the lower prices, because their vehicles’ gas tanks remain pretty full.
In Florida alone, gasoline demand is down as much as 50% in large cities, as residents self-isolate at home.
The longer demand is down, the more crude and gasoline supplies will build; and it will take some time for drivers to work through all that, once the stay-at-home orders are lifted, AAA cautioned.
On Sunday, Florida’s cheapest gas was found in Jacksonville, where it was selling for $1.72 per gallon; Panama City, $1.73 per gallon, and Punta Gorda, $1.74.
The most expensive Florida gas was found in Gainesville, $2.05 per gallon; West Palm Beach, $2.02; and Miami, $1.97.
On Monday morning, gas was selling for $1.70 in Jacksonville, $1.75 in Tampa, $1.77 in Orlando, $1.78 in St. Petersburg, $1.85 in Tallahassee, $1.88 in Sarasota, $1.92 in Naples, and $1.97 in Fort Lauderdale.