Rising gas prices: sign of economy rebounding

Posted at 6:31 PM, Mar 22, 2021

LEE COUNTY, Fla. — Gas prices are on the rise. Experts say that’s happening for a number of reasons - mainly because life is starting to get back to “normal.”

Compared to the height of the pandemic last year, gas prices nationwide today are nearly a dollar more per gallon. Florida Gulf Coast University Finance Professor Tom Smythe said that’s because things are slowly getting back to normal.

“People are traveling more. People are getting back into job routines. Those that are going back into offices,” he said.

He also said the increase could be caused by the the Organization of the Petroleum Exporting Countries (OPEC) reducing worldwide oil production by 7 million barrels per day.

Domestic oil production also slowed after freezing temperatures hit Texas last month.

Bringing it back to the Sunshine State, Florida’s prices are slightly higher than the nation’s average of $2.88 per gallon. Smythe attributes that to one thing.

‘Roads in Florida have a much bigger impact, because of tourism. The fact that people need to get into and out of Florida,” he said.

He added the demand for jet fuel has also increased with the Travel Security Administration or TSA reporting nearly three times as many travelers Sunday than they saw on the same day last year.

But, gas prices could drop again based on the global set price for future gas purchases.

“Gasoline Futures Contract were up around $2.05/$2.10. I just looked and they’re down to $1.95,” said Smythe.

He also said pump prices tend to jump up again in the summer. He said that trend will probably continue this year as more people get vaccinated and look to travel again.