Most states including Oregon are seeing prices at the pumps decline as travelers get ready for Thanksgiving travel next week. U.S. demand for gas has increased but fluctuating crude oil prices have helped keep pump prices in check. For the week, the national average for regular dips four cents to $3.76 a gallon. The Oregon average drops six cents to $4.77. This is the 10th-largest weekly drop for a state in the nation.
AAA projects 54.6 million Americans (16.4% of the population) will travel 50 miles or more from home for the Thanksgiving holiday, up 1.5% from 2021. This year is expected to be the third-busiest for Thanksgiving travel since AAA started tracking in 2000, only behind 2005 and 2019. About 777,000 Oregonians will head over the river and through the woods for turkey and all the trimmings. Find details and tips for travelers in the AAA Thanksgiving news release.
“Crude oil prices have remained in a fairly tight range between about $85 and $93 per barrel for several weeks. The national average has barely budged, but pump prices here on the West Coast have fallen 77 cents since October 9,” says,” says Marie Dodds, public affairs director for AAA Oregon/Idaho. Gas prices soared on the West Coast starting in late September when several refineries underwent planned and unplanned maintenance, putting a severe crimp in supplies.
Crude oil prices rose above $90 briefly earlier this month but fell back into the mid-$80 range on news of an increase in coronavirus cases in China. Monday, the Organization of the Petroleum Exporting Countries (OPEC) slightly lowered its forecast for global oil demand in its monthly report. These factors have created head winds for crude oil prices. Crude reached a recent high of $122.11 per barrel on June 8, and ranged from about $94 to $110 per barrel in July. In August, crude prices ranged between about $86 and $97. In September, crude prices ranged between about $76 and $88 per barrel. In October, crude ranged between $82 and $92 per barrel.
Crude prices rose dramatically leading up to and in the first few months of Russia’s invasion of Ukraine. Russia is one of the world’s top oil producers and its involvement in a war causes market volatility, and sanctions imposed on Russia by the U.S. and other western nations resulted in tighter global oil supplies. Oil supplies were already tight around the world as demand for oil increased as pandemic restrictions eased. A year ago, crude was around $81 per barrel compared to $87 today.
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 56% of what we pay for in a gallon of gasoline is for the price of crude oil, 20% is refining, 11% distribution and marketing, and 14% are taxes, according to the U.S. Energy Information Administration.
Demand for gasoline in the U.S. rose from 8.66 million b/d to 9.01 million b/d for the week ending November 4. This compares to 9.26 million b/d at this time last year. Total domestic gasoline stocks decreased by nearly 1 million bbl to 205.7 million bbl. Tight supply and robust gasoline demand would typically push pump prices higher, but fluctuating oil prices have limited cost increases.