Hey, your summer vacation just got cheaper, at least if you were planning to take it in your car. An international oil glut has sent gas prices spiraling down like a Kansas farmhouse riding a tornado. And in this tortured — but, admit it, amusing! — metaphor, the oil-producing nations of OPEC are the wicked witch about to be clobbered and you’re the munchkins, newly liberated to drive the Yellow Brick Road at bargain prices.
“Oh yeah, cheap gas and stable prices, that’s the kind of story drivers like,” laughed Patrick DeHaan, senior petroleum analyst at GasBuddy.com.
Both GasBuddy and auto club AAA reported Monday that the national average for a gallon of gasoline is $2.33, which is 4 cents lower than last week and 4 cents lower than the same date a year ago.
And it’s 10 cents a gallon cheaper than the average price of the past several years, DeHaan said. “Ten cents a gallon less than the average for summer-peak driving — I can’t think of too many years we’ve had that.”
In Miami, the price contrasts are even starker. The average price per gallon, $2.36, is about the same as the January price, which stands the conventional wisdom of gasoline economics — lower prices in the winter than in the summer —on its head.
At some places in Miami, you can beat that average price by a lot. On Monday, some stations near West Flagler Street and Red Road were charging just $2.03 per gallon. On the other hand, buy gasoline on Le Jeune Road near the airport only if you have a sadomasochistic urge to throw your money away: A few gas stations there were asking $3.79 a gallon plus your first child. (Just kidding about the child part ... for now.)
Prices typically rise in May as refineries change their production from heavier winter gasoline to a light summer blend that burns more efficiently in higher temperatures. The summer blend is more difficult to refine, so gasoline supplies drop just as the summer demand is beginning.
Then, in a normal year, the prices drop a penny or two and remain relatively stable the rest of the summer, unless a hurricane gets loose in the Gulf of Mexico and wreaks havoc with production.
But this is no normal year. Gas prices have been falling in Florida for eight consecutive weeks now. And this isn’t a regional phenomenon — 47 states recorded a drop from last week to this one. It’s the result of a boom in U.S. oil production so high that even a decision by OPEC countries last year to cut their own production hasn’t had any effect.
OPEC countries late last month agreed to extend their cuts for another nine months. Still, the price of oil has hovered between $46 and $53 a barrel — a fraction of the $148 a barrel price as recently as 2008.
“The production of oil from American shale has just erased anything OPEC tried to do,” DeHaan said.