Regular gasoline is back below $4 a gallon across the region’s three major metro areas. Cheaper wholesale fuel and softer fall demand could bring more relief over the next few weeks.
By Nadia Clarke | M•I•A MEDIA GROUP
MIAMI — South Florida drivers are paying about 30 to 35 cents less for a gallon of regular gasoline than they were a month ago. On Nov. 10, AAA put the average at $3.82 in Miami, $3.84 in Fort Lauderdale and $3.95 in West Palm Beach-Boca Raton. All three metro areas were below $4 a gallon, though each was still about 95 cents to $1 higher than a year earlier. Florida’s statewide average was $3.77.
For a driver buying 15 gallons, the month-over-month decline amounts to roughly $5 in savings per fill-up. That same purchase still costs about $14 more than it did a year ago. The difference matters for South Floridians who drive long distances to work or fill up several times a week for delivery, rideshare or other jobs.
Why prices are falling
Crude oil and gasoline futures fell sharply last week, according to AAA. Futures reflect what traders expect to pay for fuel or oil delivered later. When those prices fall, wholesale gasoline can become cheaper, and stations can pass along some of the savings as they buy new supplies. That takes time, which is why the price on the sign can keep falling after the initial drop in the market.
The usual fall slowdown is helping. Drivers generally use less gasoline after the summer travel season, and the winter blend sold at this time of year costs less to produce. Patrick De Haan, a petroleum analyst at GasBuddy, also pointed to refineries finishing seasonal maintenance. As those facilities return to normal operations, they can produce more fuel at a time when demand is softer.
Global oil prices are another factor. Brent crude, an international benchmark, fell to about $89 a barrel on Nov. 10 amid hopes that tensions over the war with Iran would ease. A lower price for crude reduces one of the largest costs of making gasoline. The same link works in reverse if renewed fighting or trouble moving oil through the Persian Gulf pushes crude prices back up.
How long could the decline last?
South Florida could see further price declines over the next one to three weeks, potentially through Thanksgiving, if wholesale costs stay low. That is a near-term outlook based on AAA’s assessment that recent market declines are still reaching the pump and De Haan’s expectation that national prices could keep falling for another week or several weeks before leveling off. West Palm Beach-Boca Raton, at just 5 cents below $4, has the smallest cushion of the three metro areas.
December is harder to call. In its Nov. 10 outlook, the U.S. Energy Information Administration projected that Brent crude would stay near $100 a barrel through the end of the year, citing low global inventories, attacks on tankers and constrained shipping. The forecast was completed Nov. 5, before Brent fell to about $89. If crude moves back toward the agency’s forecast, South Florida’s decline could stall or reverse even with the usual seasonal slowdown.
For Thanksgiving travelers, the recent drop gives them reason to expect a cheaper fill-up than they had in October. Whether that relief carries into December will depend largely on whether the decline in oil and wholesale gasoline prices holds.
