AAA: Middle East Tensions Causing Higher Fuel Prices

Oil prices surged Friday (January 3rd)

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Daytona Beach, FL - Florida drivers could see a jump in prices as things heat up in the Middle East yet again.

According to AAA, The situation has already led to higher crude oil prices, which typically raises the cost of producing gasoline. 

This is after the news broke that the United States carried out attacks against Iran, causing crude prices to surge nearly $2 a barrel. That kind of increase can trigger a five-cent rise in prices at the pump. West Texas Intermediate (WTI) eventually settled at $63.05 a barrel, which is the highest daily settlement since May of last year.

"What happens in the Middle East can have a direct impact on Americans' daily lives, by influencing what they pay at the pump," said Mark Jenkins, spokesman for AAA. "Many people don't realize that half of what they pay for every gallon of gasoline is determined by the price of oil. Even though the US is producing oil at a record pace, that oil is bought an sold on the stock market, which is heavily influenced by global supply and demand. Crude prices rise when there's a threat of war, because of concerns over how the conflict could hamper supply and demand."

Some of this increase was influenced by another week of lower US crude inventories, but the situation in the Middle East was the top story.

"It's still far too early to know how much of an impact this conflict will have overall on prices at the pump," Jenkins continued. "We'll likely have a better idea early this week. Some analysts are anticipating a 'Manic Monday' on the stock market, with many financial and physical traders returning from vacation. Either way, volatility should be expected with both oil and gasoline through January, at the very least. If geopolitical tensions continue to escalate, crude prices may rise and drag gasoline along for the ride."

Florida gas prices climbed an average of seven cents per gallon in the past three days. That was set into motion before the US airstrikes last week, by crude price hikes that occurred last month. The state's average (as of this morning, January 6th, at 6 a.m.) currently sits at $2.53 per gallon (regular unleaded), which is seven cents more than last week's average of $2.45.

Volusia County seems to have had a bigger increase than the state did since average prices are sitting around $2.50, which is eight cents more than the $2.42 average price drivers paid last week.

Flagler drivers, on average, are paying the same as Volusia drivers at $2.50.

West Palm Beach-Boca Raton had the highest reported averages statewide with $2.63. Jacksonville had the cheapest in Florida, with an average just a penny under Volusia and Flagler at $2.49.

The nationwide average now hovers around $2.58

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