ANDERSON — For the last few months, going to the gas pump has been a pleasant experience for most people as the price per gallon plummeted at the end of 2014. Since the calendar turned over to a new year, the price has been all over the place, sometimes jumping 5 to 8 cents per gallon in the course of a day.
The rapidly fluctuating prices are a direct result of crude oil prices worldwide. After prices fell from June to January, they bounced back up in February before falling again earlier this week. The Associated Press reported that the price of oil has risen or fallen by at least 3 percent on 14 of the last 27 stock market trading days. In short, no one really knows where the price is going to go next.
"This has been an extraordinary time when gas has fallen more quickly than I've ever seen," Jay Ricker, chairman of Ricker's Oil Company, said.
Ricker said companies like his that sell gas are usually just along for the ride when the price of oil starts to fluctuate.
"We make about the same profit on a gallon of gas regardless of what the price is," Ricker said. "But it does help when the price is low."
One of the bigger advantages for gas stations when the price is low is people are making fewer trips to the stations. When gas is $2 per gallon, $20 goes a lot further than it does if gas is $3 per gallon. It might seem counter-intuitive, but Ricker said fewer trips to the station are better for business because he pays less in credit card fees. Typically, businesses have to pay a fee every time someone swipes a credit card in the store or at the pump.
"I think its better for everyone when gas prices are low," he said. "It helps the economy, people get more gas per trip and we have less credit card fees."
The oil prices have also had an impact on other sources of energy, including ethanol. The seeming instability of oil prices drives home the need for other sources of energy, according to Dave Hudak, the general manager of POET Biorefining-Alexandria.
“Although consumers are enjoying low gas prices now, the volatility of the oil market emphasizes how important it is for our country to have a stable, domestic energy policy that doesn’t depend on decisions made by foreign countries," Hudak said. "Ethanol reduces our nation’s dependency on foreign oil."
While low prices now are good for consumers, the odds of oil prices suddenly swinging the other way are a real possibility. According to the AP, experts differ on which way prices will go now. The price drop has been due to an increase of production in the United States and a drop in consumption due to struggling economies in Japan and Europe. The low prices have led to a decrease in production in recent months, which some experts say will raise the price. Others aren't as sure.
Ricker said prices tend to go up this time of year across the nation due to refineries being cleaned and inspected. The recent jump could simply be due to that.