Gas for a Dollar

By Adam Fishman

December 6, 2008

WINTER PARK, Fla—Remember the days when gas was 99 cents per gallon? You could actually afford to fill your gas tank. It seems so long ago, according to Motor Club AAA energy figures, gas was 97 cents per gallon in March of 1999. For one Winter Park 7-Eleven store owner, gas for a dollar could be a reality again.

Nathaniel Rodriguez, 31, is senior store manager at the 7-Eleven off lee road in Winter Park. The cost of gas per gallon is influenced by many factors, supply and demand being at the forefront. “The more consumers drive the higher the demand, which leads to higher gas prices,” stated Rodriguez. The price of gas is like riding a roller-coaster, up and down. Factors that determine prices range from the cost of crude-oil, refining costs, taxes, distribution, weather, location, production and station markup.

“My responsibility is to compile data that accounts for usage at my store; I report these figures to a regional manager who then reports to their managers. It’s a chain going up, figures across the country are put together to determine the added markup for a profit based on location and usage,” stated Rodriguez. According to the U.S. Department of Energy, service stations will add anywhere from a few cents to a dime, but there is no set markup limit. Rodriguez was unable to state the average markup for his store because it would jeopardize the integrity of the company.

“We do stay competitive in this type of market,” Rodriguez said. So can gas come down to that magic number? Rodriguez thinks it can happen. According to the Financial Times, the cost of oil is currently $46.82 a barrel. “The cost of oil has to come down a little more, at least by $10. The area we service could see $1.05 to a $1.10 per gallon,” Rodriguez stated. Those numbers are very close to one dollar.

Rodriguez is accurate in his statement. According to U.S. Department of Energy statistics, the cost of oil was $35 in 1999 when gas was floating around a dollar. The single most important entity that impacts the world’s oil supplies is the Organization of the Petroleum Exporting Countries (OPEC). OPEC consists of 13 countries including Iran, Iraq, Saudi Arabia, and Venezuela. According to the Energy Information Administration, when OPEC wants to raise the price of oil they simply reduce production. In return, this causes gas prices to jump because of the short supply.

If gas prices come down to a dollar per gallon, business at Rodriguez’s store would increase. “It’s pretty obvious, as gas prices come down people travel more. Hopefully, they come to my store to fill up their tanks.” Rodriguez is optimistic about the possibility of even lower gas prices, but what about consumers?

Customers at Rodriguez’s 7-Eleven shared their opinions. Karen DeMarco from Eatonville stated, “I doubt gas prices will be a dollar a gallon ever again, not with the way the economy is now.” Riley Harrell of Winter Park stated, “God I hope the price can come down that low, if production levels can stay consistent I think it’s a real possibility.”

A real possibility it may be. There are still so many contributing factors that determine the cost of gas. The trend taking place right now is certainly a step in the right direction, but gas for a dollar a gallon again? Let’s keep our fingers crossed.

More information can be found about 7-Eleven at www.7-eleven.com. Information about OPEC can be found at www.opec.com.