Fuel prices drop as Kemp signs tax suspension bill, oil prices drop
COVINGTON, Ga. — Gasoline prices Monday in Newton County were about 12 cents lower than the previous week, but remained a few cents above the state average.
In Georgia, a gallon of regular unleaded gasoline costs an average of $4.12, according to AAA Monday afternoon. But in Newton County, the average was $4.18 a gallon.
Although slightly above the state average, Newton County gasoline prices were lower than a week ago ($4.25 Thursday) when fuel cost rates hit highs. unprecedented heights.
Prices across Georgia are expected to continue falling as Gov. Brian Kemp signed legislation on Friday to temporarily suspend the state’s gasoline tax and oil prices continue to fall.
The state has suspended gasoline tax in the past when fuel supplies were disrupted, most recently when the Colonial Pipeline was shut down last May following a ransomware attack.
The Governor is legally authorized to suspend the tax by decree when the General Assembly does not meet. In this case, with lawmakers in session, Kemp waited for his proposed bill to make its way through the House and Senate.
The suspension is set to expire May 31, according to a Capitol Beat News Service report, unless the governor decides pump prices are still high enough to warrant its continuation.
The tax suspension will save Georgians 29.1 cents per gallon of gas, Senate Finance Committee Chairman Chuck Hufstetler, R-Rome, said before the bill passed Thursday by the Georgian Senate.
Several Republicans in Georgia have blamed the Biden administration for rising gas prices.
Hufstetler then accused the Biden administration of contributing to higher gas prices through the Democratic president’s decision to cancel the Keystone XL project last year and ban oil and gas drilling in the eastern Gulf of Mexico and on federal lands in Alaska.
Sen. Greg Dolezal, R-Cumming, said gasoline prices started rising long before Russian troops entered Ukraine three weeks ago.
“Gasoline prices went up $1 a gallon last year,” he said.
But Senate Democrats have said the oil industry is responsible for keeping U.S. oil production going, not the Biden administration. Energy Secretary Jennifer Granholm last week called on the industry to increase oil and gas production.
“The administration only controls drilling on federal lands,” said Sen. Nan Orrock, D-Atlanta. “It is the decision of the fossil fuel industry not to drill. … There are permits that the oil companies have that they don’t have access to … because it’s not profitable. They make decisions expecting the demand for fossil fuels to decline.
Hufstetler said the temporary gas tax suspension would cost the state between $300 million and $400 million in lost revenue. This discrepancy will be covered by reserve funds, he said.
The suspension will expire on May 31. Kemp could then extend it by decree if he deems it necessary.
According to AAA, the price of oil has fallen due to market concerns about declining demand for crude oil, as was the case in 2020 when countries sought to reduce COVID-19 transmission rates. Additionally, the Energy Information Administration (EIA) reported that total national crude inventories increased by 4.3 million barrels last week to 415.9 million barrels. Recent growth in total domestic crude inventories has also contributed to the current decline in crude prices.
Capitol Beat News Service contributed to this report.