ORLANDO, Fla. – If you pay attention to the gas prices at your local station, you might have noticed this.
On Monday morning, gas prices are less than $3 a gallon. By the afternoon, prices are on their way up again. Then, by the weekend, they’re back down below $3 a gallon.
It’s happening right now. AAA says the current average for gas prices in Florida is $3.063 a gallon. On Monday, it was listed as $2.924 a gallon. That’s a 14-cent jump overnight.
This fluctuation in Florida gas prices has been going on for a while. AAA spokesman Mark Jenkins says it’s most likely a gasoline retailer strategy called “price cycling.”
“Retailers, they’re trying to compete with their competitors,” Jenkins said. “And they’re lowering prices and eventually they just reach a low where it’s just not sustainable anymore. And they have to raise them back up again to cover the cost of buying and selling gasoline.”
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Price cycling is something that typically happens in the Midwestern states. However, Jenkins says they’ve been noticing it for about a year now in Florida, and the analysts at AAA suspect it’s because the crude oil market has been relatively stable.
“In years past, oil prices have really been influenced by a number of different things, from geopolitical tensions to hurricanes, various supply and demand issues,” Jenkins explained. “But during the past year, oil prices haven’t really moved a whole lot. They’ve, they’ve moved within a range of about $10 a gallon, which can be the equivalent of about a 25-cent shift in prices at the pump. So not a lot of movement there.”
Which means retailers are looking for a way to entice more people to stop in, not only to buy gas, but to buy things in their stores.
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“A lot of gas stations, they don’t make their money on gasoline, they make their money on what’s being bought and sold in the concession stands. So there’s a pretty decent markup on things like water and food,” Jenkins said.
Jenkins believes, if recent trends hold, prices at the pump will decline further heading into the Labor Day weekend, where prices are expected to be down at least 21 cents from last year.
And in the meantime, if you notice this cycling trend among the gas stations near you, Jenkins says to take advantage of it.
“If you’re aware of the trends, then you can take advantage of it and save some money at the pump. So the weekends and Monday morning tend to be the cheapest time at the pumps,” Jenkins said.