Pump prices continue to creep lower in most states, including Oregon. Lackluster demand for gas, growing gasoline supplies and lower crude oil prices are all contributing to those declining prices at the pumps. However, drivers in the Midwest have seen prices spike due to a power outage at a refinery in the Chicago area. For the week, the national average for regular ticks down one cent to $3.50. The Oregon average loses four cents to $3.96 a gallon.
“The arrival of summer used to signal the start of the busy summer driving season, but demand has been tepid this year. While travel volumes set records for the Independence Day holiday, demand for gas has tapered off since then. The scorching heat over much of the country and wildfires may be factors,” says Marie Dodds, public affairs director for AAA Oregon/Idaho.
This week, 21 Oregon counties have averages below $4 per gallon, compared to 20 counties a week ago:
- Baker $3.80
- Benton $3.59
- Clackamas $3.98
- Crook $3.89
- Deschutes $3.77
- Douglas $3.83
- Gilliam $3.90
- Hood River $3.95
- Jefferson $3.72
- Klamath $3.98
- Lane $3.78
- Linn $3.67
- Lincoln $3.71
- Malheur $3.86
- Marion $3.86
- Morrow $3.83
- Polk $3.85
- Sherman $3.86
- Umatilla $3.80
- Yamhill $3.87
- Wasco $3.92
The Oregon average began 2024 at $3.79 a gallon compared to $3.96 today. Its lowest price so far this year is $3.58 on February 14 and the highest is nearly $4.51 on May 1. The national average started the year at $3.11 and is at $3.50 today. Its lowest price so far this year is just under $3.07 on January 15 and the highest is just under $3.68 on April 19.
Gas prices are often fairly steady during the summer months, barring hurricanes, supply disruptions and/or geo-political events. Gas prices always rise starting in late winter through the spring as refineries undergo maintenance as the switch to summer-blend fuel occurs. The switch occurs first in California, which is why pump prices on the West Coast often rise before other parts of the country. The East Coast is the last major market to make the change to summer-blend fuel. Most areas have a May 1 compliance date for refiners and terminals, while most gas stations have a June 1 deadline to switch to selling summer-blend until June 1. Switch-over dates are earlier in California with some areas in the state requiring summer-blend fuel by April 1. Some refineries will begin maintenance and the switchover as early as February.
Crude oil prices have fallen below $80 per barrel this week, in part due to soft demand and some negative economic news out of China. Crude prices are impacted by economic news as well as geopolitical events around the world including the war between Israel and Hamas, the war between Russia and Ukraine, and Houthi militant attacks in the Red Sea. In addition, production cuts by OPEC+ have tightened global crude oil supplies, which will continue to impact prices. And we’re in hurricane season, which runs from June 1 to November 30.
The price of crude oil reached the year-to-date high of nearly $87 per barrel on April 5. West Texas Intermediate climbed above $80 on March 14 and above $85 on April 2, then dipped below $85 starting on April 17 and below $80 again on May 1. WTI rose above $80 per barrel again on June 17, then fell below that threshold today. Major drivers of elevated crude prices are the unrest in the Middle East, the decision by OPEC+ to keep oil production cuts in place, and Ukrainian attacks on Russian refineries. Russia is a top global oil producer and the refinery attacks have reduced output.
Crude prices have been volatile after the attack on Israel by Hamas last October. While Israel and the Palestinian territory are not oil producers, concerns remain that the conflict could spread in the Middle East, which could potentially impact crude production in other oil-producing nations in the region.
Crude oil is trading around $77 today compared to $80 a week ago and $79 a year ago. In 2023, West Texas Intermediate ranged between $63 and $95 per barrel. Crude reached recent highs of $123.70 on March 8, 2022, shortly after the Russian invasion of Ukraine, and $122.11 per barrel on June 8, 2022. The all-time high for WTI crude oil is $147.27 in July 2008.
Crude oil is the main ingredient in gasoline and diesel, so pump prices are impacted by crude prices on the global markets. On average, about 54% of what we pay for in a gallon of gasoline is for the price of crude oil, 15% is refining, 18% distribution and marketing, and 14% are taxes, according to the U.S. Energy Information Administration.
Demand for gasoline in the U.S. plummeted from 9.40 million b/d to 8.78 million b/d for the week ending July 12, according to the U.S. Energy Information Administration (EIA). This compares to 8.86 million b/d a year ago. Meanwhile, total domestic gasoline stocks rose from 229.67 to 232.99 million barrels. Gasoline production took a slight ding, likely from Hurricane Beryl, dropping from an average of 10.3 million barrels daily to 9.5.
Low gasoline demand and wobbly oil costs may lead to slowly lowering pump prices.
Quick stats
Oregon is one of 41 states with lower prices now than a week ago. Delaware (-9 cents) has the largest week-over-week drop in the nation. Illinois (+13 cents) and Ohio (+13 cents) have the largest weekly jumps. Storms in Illinois knocked out power to an Exxon-Mobil refinery in Joliet, causing pump prices in the region to soar.
After 20 weeks, Hawaii ($4.68) bumps California ($4.67) as the state with the most expensive gas in the nation. Washington ($4.25) is third most expensive. These are the three states with averages at or above $4 a gallon, down from four states a week ago. This week 46 states and the District of Columbia have averages in the $3-range. There is one state with an average in the $2 range this week.
The cheapest gas in the nation is in Mississippi ($2.99) and Louisiana ($3.08). No state has had an average below $2 a gallon since January 7, 2021, when Mississippi and Texas were below that threshold. At the time, the nation was grappling with the COVID-19 pandemic.
The difference between the most expensive and least expensive states is $1.69 this week, compared to $1.74 a week ago.
Oregon is one of 10 states with lower prices now than a month ago. The national average is six cents more and the Oregon average is 12 cents less than a month ago. This is the fourth-largest month-over-month decline in the nation. Arkansas (+19 cents) has the largest monthly gain in the nation. Arizona (-15 cents) has the largest month-over-month decrease.
Oregon is one of 43 states and the District of Columbia with lower prices now than a year ago. The national average is nine cents less and the Oregon average is 62 cents less than a year ago. This is the second-largest year-over-year drop in the nation. Washington (-67 cents) has the largest yearly decrease. Indiana (+24 cents) has the largest year-over-year increase.
West Coast
The West Coast region continues to have the most expensive pump prices in the nation with six of the seven states in the top 10. It’s typical for the West Coast to have six or seven states in the top 10 as this region tends to consistently have fairly tight supplies, consuming about as much gasoline as is produced. In addition, this region is located relatively far from parts of the country where oil drilling, production and refining occurs, so transportation costs are higher. And environmental programs in this region add to the cost of production, storage and distribution.
Diesel
For the week, the national average falls three cents to $3.83 a gallon. The record high is $5.816 set on June 19, 2022. The Oregon average loses two cents to $4.06. The record high is $6.47 set on July 3, 2022. A year ago the national average for diesel was $3.88 and the Oregon average was $4.42.
Source: AAA