The decision by Gov. Brian Kemp and state lawmakers to suspend Georgia’s gas tax last month made a difference at the pump, a look at recent prices shows.
But the decision could not offset weeks of uncertainty in international oil markets amid the U.S.-Israeli war against Iran, and prices have nearly recovered to what they were when the governor signed legislation suspending the tax on March 20.
A two-week ceasefire could bring relief to motorists pumping gas, if it results in more tankers being allowed to transit the Strait of Hormuz. But one industry expert believes that relief could be short-lived because the Persian Gulf region remains volatile.
“The situation’s not clear,” said Patrick De Haan, a petroleum analyst at GasBuddy. “We could quickly be back at record levels.”
Statistics collected by AAA show the regular price of unleaded gas in Georgia rose more than $1 a gallon in the weeks after the Iran war began Feb. 28. Three weeks later, Kemp suspended Georgia’s 33-cents-per-gallon tax on gasoline and 37-cents tax on diesel.
The result was a sharp drop in average gas prices statewide — but not a 33-cent drop. It fell from $3.79 on the day Kemp suspended the tax to $3.58 10 days later, according to AAA. That’s a 21-cent decline.
Then it began creeping up again, reaching $3.74 a gallon on Thursday — nearly back to the level when Kemp suspended the tax.
De Haan said Kemp’s action made a difference — Georgians are paying 33 cents less per gallon of regular gas than they would be if the tax were still in effect. But it can’t overcome upward pressure on prices caused by the Iran war, the closing of the Strait of Hormuz to tankers and the roiling of international oil markets.
He said seasonal changes from winter to summer grades of gasoline also have contributed to rising prices.
Some have wondered whether price gauging has played a role in rising prices. Attorney General Chris Carr recently warned gasoline distributors that failing to pass along the savings from the suspended tax could constitute an unfair or deceptive business practice in violation of state law.
Carr spokesperson Kara Murray said the office has received about 30 complaints about gas prices that are under investigation. But she said the price of gas will fluctuate even during the suspension period, and “it’s difficult for consumers to look at a price and know it’s a problem.”
“Overall, Georgia is among the lower average cost states, and I think it’s safe to say the gas tax suspension is reflected in that,” she said.
De Haan doubts many distributors have failed to pass along the savings. He said they have an incentive to cut prices as quickly as possible to gain a competitive advantage with price-sensitive consumers.
Thanks to this week’s ceasefire, De Haan said consumers should begin to see lower gas prices this weekend. But he thinks such gains could be short-lived.
De Haan said hostilities could resume soon, and he won’t be surprised if gas prices begin rising again.
“There’s less friction now,” he said. “But the coast is anything but clear.”
— AJC senior editor Charles Minshew contributed to this report.
About the Author
Keep Reading
The Latest
Featured
