JACKSONVILLE, Fla. - The average price for a gallon of gas in Jacksonville on Wednesday is $3.37, which is up seven cents from just a week ago.
“This is the normal New Year’s pop that we see in prices,” said Patrick DeHaan, senior petroleum analyst for GasBuddy.com and WOKV’s oil expert.
DeHaan said for six out of the last seven years, gas prices have gone up between Christmas Day and January 15. This year will probably make it seven out of the last eight years.
He has a few “sneaking suspicions” for why prices typically jump in that time period.
“I think one of the biggest issues is that there is optimism surrounding the holiday season with retailers reporting their sales,” DeHaan said.
“And with an improving economy, generally those reports are bright. And it leads to the perception that the economy is improving, spurring investors and buyers to get back into the gasoline trading business and that generally puts upward pressure on prices.”
The other reason for the jump, according to DeHaan, is that typically this time of year refineries are drawing down inventories of products on hand, which is for tax purposes. At the end of the year, refineries have to pay taxes based on what they hold.
“We may see prices stabilize somewhere in the mid three dollar range over the next month or two, anywhere from three-forty-five to three-sixty-five a gallon is where I’d expect prices to stay,” DeHaan said.
For the short term, he does not believe we will continue to see prices rise at the rate they have in the last week.
“We shouldn’t be seeing any significant increases in the next month or month in a half. That’s just because demand for gasoline is lower.”
DeHaan said he will be watching outside factors such as the Middle East and what happens with the U.S. economy to get a clue as to where prices will go in the months ahead.