MIAMI (CBS4) – The summer tourism season is right around the corner, but this year’s tourism dollars may not be nearly what leaders originally forecasted thanks to gas prices heading towards record territory.

For South Florida, whose life-blood is the tourism industry, this could spell big problems for the local economy.

The American Automobile Association (AAA) reports in the last week, the price for regular unleaded in Florida has risen about dime to $3.76 a gallon. Last year at this time, the price for unleaded regular was hovering near $2.88 a gallon.

“The prices have been going up every day.  Friday it went up five cents, Saturday five cents, diesel is going through the roof, it went up 11 cents this week,” said local gas station owner Alan Berman.

According to MasterCard SpendingPulse, which tracks spending at 140,000 gas stations across the nation, gas sales have dropped for five straight weeks. It was the first time a consistent drop had been seen for that long of a period since last November.

MasterCard’s report shows drivers bought 2.7 billion gallons of gas last week, down 3.6 percent from the same period in 2010, when it was 80 cents cheaper.

Some analysts predict the price at the pump could reach five dollars a gallon in the next few months.  While the AAA Auto Club South doesn’t think it will got that high, they say we could see record prices soon.

“We can expect gas prices to go the highest we ever seen gas prices, in the range of $4.20, $4:25 or $4.30 per gallon,” said AAA Auto South spokesman Juan Rivera.

Mike Myers fixes windows for a living, many of his jobs are on boats.  Myers said the price of gas affects more than just how much it takes to keep his four repair trucks on the road.

“Gas prices right now are crushing the guys in the mid to small boat range. People can’t go fishing and what do you do in Florida,” said Myers.  “If the guys don’t use their boats, we don’t fix  them.”

Americans also appear to be turning to smaller, more fuel-efficient cars to save on gas. Sales of the Hyundai Sonata and Elantra soared 55 percent in March. Meanwhile, sales of Chevy’s Suburban SUV dropped nearly 24 percent.

Airlines will begin to hike airplane ticket prices shortly. If gas reaches $5 a gallon as some analysts are predicting, the rise in airline prices will likely be dramatic. Also, cruise lines will also have to begin to raise prices to meet higher fuel costs.

With fewer people flying and/or driving, hospitality industries in South Florida will struggle. And as unrest in North Africa and the Middle East allow speculators to drive oil prices through the roof; the problem will only continue to be exacerbated.

For drivers in South Florida, and across the country, high gas prices is going to make the need to carpool, combine trips, or simply give up some things a grim reality. And with public transportation in South Florida, severely lacking, some workers will have to face the reality of if it’s too expensive to get to a job.

But, a drop in tourism runs a major risk to the coffers of South Florida cities and counties. Tourism brings in major revenue to help pay for things like the new Marlins Stadium. If the revenue drops, the money will still be owed and add to the possibility of major deficits.

And just because you drive a fuel-efficient car, don’t think you will get away from the rise in gas prices unscathed.

Many businesses are starting to hike prices in the store, and especially for delivery. The U.S. Post Office has started running ads that say while others are raising prices, they will charge their current price for delivery.

If U.S. demand drops, even dramatically, it likely won’t impact gas prices. Global demand is expected to continue to rise, which will only further increase speculation on higher prices in the future.

The rise in gas prices also sets up a showdown between Democrats and Republicans.

President Barack Obama and Democrats have proposed more fuel-efficient standards, high-speed rails, getting rid of oil subsidies, among other things to help with the fuel crisis.

Republicans have pushed back against raising fuel standards saying it will hurt the current recovery. Their plans include reducing business taxes to help fuel the recovery.

The GOP has also fought high-speed rail lines, most notably Florida Governor Rick Scott’s questionable decision to give the federal government $2.4 billion back that had been earmarked for a high-speed rail line in Florida.

Democrats will portray their opponents as fighting a move towards more energy independence and saving money on gasoline. Republicans will counter saying that the Democrats plans will cost too much and negatively impact job creation.

All the while, industries in South Florida, and across the nation, will be left trying to figure out how to price goods to sell, while meeting the rising costs of delivery.

And consumers will be left trying to figure out how to meet their rising gas costs and sustain their overall spending to help keep the recovery going.

To find cheap gas in your area, click here.

Comments (8)
  1. rausky says:

    This problem will not be solved as the Federal Government doesn’t care about “The People”! They only care about their OIL investments while the middle and working class suffer!
    On top of that,you have the GREEDY,CORRUPT speculators, who pay Congress for their FREE RIDE ,hurting the middle and working class!! !! Don’t expect our CORRUPT politicians to do anything for us, except give it to us up the WAZOO! like always!!

    1. Al Merrill says:

      Take oil off the Futures Market!!! That will put the price where it should be hopefully. But you are correct the whole world economic problem is fueled by the on five letter word. “GREED”

      1. Al Merrill says:

        I know I forgot to use spellcheck.

  2. rhaduznt says:

    If you listen to the news, you will hear little comments here and there about and from the oil companies. The reason the prices are so high if first of all greed on the part of oil companies. Secondly, they know if they squeeze the working people enough, we will force the government to allow them to drill anywhere anytime they want without any oversight. Then we end up with more disasters like the Gulf mess.

    1. GAIN AND AGEIN says:

      Well said!

      How about these news scares reguarding GOVERNment. SHUT-DOWNs????

      Stop GOP Tactics EveryWhere!


  3. Matthew Wilks says:

    really? REALLY?? I agree with the “GREED” comments and viewpoints, but if ya want answers, go to a streaming video site and watch “Collapse”…we are running out of oil, it is not an indefinite producing resource… we ARE running out of oil! Before any of you jump on my back and list the ever-so-elusive vein in Alaska that will supply us with oil for 100+ years, or any other arguments, please watch “Collapse” first, and let your argument be with the documentary, not me… for I BELIEVE that this is happening…so, I am pretty much gonna stand by that.

  4. Ron Korfel says:

    I would believe that the price of gas today is not only due to the uncertainty of what’s happening in the middle east but also because of the local or state economy. News reports that 55% of the price of gas is for profit and that 45% is due to state taxes.
    So there’s a double whammy with the price of gas and it is different in each state. Take a look at LA where the gas prices are over $4.00, Detroit at $3.85 and the state of Wyomming at $3.50.
    The state in which you live, based on the local economy, is obviously pushing gas prices so it may not be the price of a barrel of oil only but also your local state economy.
    Does it cost more to ship gas to LA as it is to Wyomming? The “Gouger’s” are not only the fuel companies but also you state govenment.

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