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Tampa Gas Prices Hit Dreaded Milestone: $4 A Gallon

Tribune photo by CLIFF MCBRIDE

Rising fuel prices are putting pressure on the economy and causing drivers to feel the heat.

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By RUSSELL RAY | The Tampa Tribune

Published: May 27, 2008

TAMPA - Regular unleaded gas breached $4 a gallon in the Tampa Bay area for the first time Tuesday, a painful milestone many motorists have feared for weeks.

A handful of Bay area retailers on Tuesday were charging more than $4 a gallon for regular-grade gas, according to gasbuddy.com, which tracks gasoline prices in major metro markets nationwide.

Tim Harper of Tampa bought gas at one of those locations — a Texaco station off Howard Avenue near Interstate 275 — for $4.01 a gallon. Harper, who works for a building foundation repair company, paid more than $76 for 19 gallons of fuel for his work van.

"I don't see how people are surviving," Harper said as he filled up the van.

Nationally, motorists on Thursday were paying an average of $3.94 for a gallon of regular gas, a record high, according to AAA. In the Tampa Bay area, the same grade of gas was averaging $3.87 a gallon, an all-time high for the region. Gas prices are averaging $4 or more in Miami, Palm Beach and Gainesville, according to AAA

Gas prices also have eclipsed $4 a gallon elsewhere in the country, including Chicago.

Pump prices typically decline after the Memorial Day weekend. But industry experts say it's unclear where gas prices are headed this year.

"There's such a disconnect between supply-demand fundamentals and what's actually occurring with retail prices that it's difficult to say," said Gregg Laskoski, spokesman for AAA South in Tampa.

Like other consumers, Harper and his wife have drastically altered their driving and spending habits because of the record cost of gas. In addition to carpooling to work, they buy half a tank of gas instead of a full tank with each visit to the gas station.

"I'm upset with it," Harper said. "But like anything in life, you're going to have to deal with it."

More motorists can no longer afford to buy a full tank of gas. Construction worker Luis Cruz put half a tank of gas in his Ford Explorer on Tuesday, but still paid a hefty price: $50.

"That will get me through the weekend," Cruz said.

The skyrocketing cost of gas has virtually stranded Tasha Lucas. On Tuesday, the Tampa resident bought $10 in gas, barely enough for two gallons. "I don't go anywhere anymore," Lucas said.

Tuesday, oil fell $2.64 to close at $128.85 a barrel on the New York Mercantile Exchange, a sign that gas prices may soon retreat.

Based solely on supply and demand, gasoline prices should be much lower, Laskoski said. U.S. gasoline demand is down about 1 percent compared with the same time last year and supplies are more than 6 percent higher, according to the Department of Energy.

"Many analysts will tell you that the price of crude oil is about $50 a barrel over what it should be," Laskoski said.

The weak dollar, however, means the record-setting surge in pump prices may continue and that more Bay area retailers could soon be charging more than $4 a gallon for gasoline, he said.

Analysts have said that the declining value of the U.S. dollar has contributed to the relentless increase in the price of oil, which is bought and sold worldwide in U.S. dollars.

"If the dollar is unable to gain strength against the euro and other currencies, then we could be looking at $4 or higher for a fairly long period," Laskoski said.

Reporter Russell Ray can be reached at (813) 259-7870 or rray@tampatrib.com.

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