MANATEE -- Surging U.S. oil production, sagging worldwide demand and -- perhaps most importantly -- the first Organization of Petroleum Exporting Countries price war in 30 years, have combined to send gasoline prices into a tailspin.
Across the nation, gas has dropped 21 cents a gallon in the past month and could fall another 20 cents or more by November, industry analysts said.
Gas prices in the Bradenton area have dropped 8 cents in the past week, down to an average of $3.19 a gallon. While that's not as low as many areas in the state, predictions are that Bradenton may see prices hit around $3 a gallon -- even below $3 at some stations -- by Thanksgiving.
Josh Carrasco, spokesman for AAA's auto club group, said Bradenton can expect to see a continuing drop in prices.
"It could come down another 10 to 20 cents by Thanksgiving," Carrasco said. "Some stations will be pretty close
to the $3 mark."
That $3-a-gallon gasoline has already made its way to some pumps in Hillsborough County.
Price surveys show several stations in Manatee County offering unleaded regular gasoline for $3.13 a gallon, with dozens under $3.20. Sam's Club in Manatee County is offering gas at $3.06, with Marathon and B.J.'s just a penny higher. In Sarasota, a 7-11 store at Tuttle and 12th Street had gas at $3.05 on Friday.
Carrasco said location and competition are factors in the different prices from region to region.
Prices, Carrasco said, "all depends on location, local taxes, competition and a variety of other factors."
Manatee County may get an extra push to lower gas prices as new competitors such as Thorntons and Wawa bring their stations -- along with more competitive gas prices -- to the county.
On Friday, Thorntons was offering all of its customers who registered for rewards an extra 10 cents a gallon off the price of gas, bringing costs close to $3.
"In the past week, we've seen a lot of Florida stations selling gas for $3 a gallon or even below that," said state AAA spokesman Mark Jenkins. "The price is down, the price is tumbling."
Seven states have already broken the magic $3 level -- be sure to fill your tank if you drive through Missouri, where the $2.88 price is the cheapest in the country -- and if the national average drops to that mark, it would be the first time since December 2010.
'Most significant decline'
Gasoline prices almost-always decline in the fall, as summer vacation ends and refiners switch to cheaper winter grades of fuel. But virtually everyone agrees that this abrupt drop is something much more profound.
"This year there are a lot of potential catalysts on the table to make this the most significant decline in a long time, and possibly the most long-lasting," said Patrick DeHaan, the senior petroleum analyst at the website GasBuddy.com. "It will probably bottom out in mid-December, but it might take a long time to rise up significantly."
Ordinarily, political upheavals in the Middle East -- like the civil wars raging in Syria and Iraq -- send the prices of crude petroleum soaring. But that isn't happening -- partly because improved oil-extraction technology has made the United States the leading petroleum producer in the world, partly because economic slowdowns in Europe and China are reducing demand.
"The real wild card, though, is OPEC," DeHaan said. When Saudi Arabia announced last month that it was cutting prices by as much as $1 a barrel, Iran and Iraq promptly declared their own price cuts. The downward pressure on prices has continued ever since, culminating Tuesday with a drop of 4.5 percent on the New York Mercantile Exchange -- the largest single-day decline in more than two years.
The reasons for the Saudi price cuts remain murky. Many analysts, including DeHaan, believe there's a deal afoot between Saudi Arabia and the United States to force prices lower to punish Russia, a major oil producer, for its military meddling in the Ukraine.
"It's easy to imagine that we sat down together on a couch with the Saudis and we said, 'Hey, old friend, the Russians are not paying attention to our economic sanctions. Maybe you could help us out here,'" DeHaan said. "A deal like that would punish not only the Russians, but some other oil-producing countries Washington is on the outs with, like Iran and Venezuela."
A similar accord between the Saudis and President Ronald Reagan in 1985 triggered OPEC's last price war. It is believed to have cost what was then the Soviet Union as much as $20 billion a year and sent its economy into a dive from which it never recovered.
How the rest of OPEC will react to the price war is just one of several hard-to-predict variables that could affect how far oil prices will decline and how long they'll stay down. Another is the spreading worry over the spread of the Ebola virus.
"It's very hard to know how consumers are going to react as new cases of Ebola pop up in different countries," DeHaan said. "If everybody wants to stay home and not be around other people, it's going to reduce gasoline demand further. But it also could affect the rest of the economy if they stop buying. There are so many angles to this thing."