Florida Retailers Feel Pinch of Price Spikes

The gasoline stations are trying to educate their customers that high pump prices don't make them happy.

March 28, 2011

TALLAHASSEE, Fla. - Higher gasoline prices are not making Florida retailers very satisfied, the Florida Times-Union reports. Rapid jumps in fuel prices hurt them just as much as it pains their customers.

Gasoline prices have been rising because of advances in crude oil prices, which means owners make the same profit on $3.60 a gallon fuel as they did on $2.60 a gallon gasoline. When it costs more to fill-up, customers tend to shy away from in-store purchases, too.

"When retail prices go up, people tend to spend less money with us," said Buzz Hoover, vice president of petroleum supply for Gate.

"Our gasoline dealers make more from selling a cup of coffee than on a gallon of gas," explained Ned Bowman, executive director of the Florida Petroleum Marketers and Convenience Store Association.

With around 58 percent of convenience stores in the state as small operations, customer loss hurts them. In addition to the gasoline prices, retailers are paying more in swipe fees. Those transaction fees, which can run between 2 percent and 3 percent, push the cost of gasoline up.

The crisis in the Middle East and Libya has made it hard to know what will happen with crude oil prices, said Jessica Brady, spokeswoman for AAA Auto Club South. "It??s uncertain whether prices will continue to drop this week since there is still much turmoil in the Mideast that could push oil prices higher," she said. "And when Japan begins to rebuild its country, their demand for oil will increase substantially."

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