The late December winter storm that slammed much of the country with snow, ice and frigid temperatures caused gas prices to spike, as refineries as far south as Texas and the Gulf Coast were forced to shut down temporarily. The storm also caused holiday travelers to fuel up and hit the road early to beat the bad weather, leading to a jump in overall gas demand. For the week, the national average for regular unleaded shoots up 12 cents to $3.23. The Oregon average slips three cents to $3.74.
“Gas prices will likely climb a little more before settling down. It will take some time for production to catch up, and for consumers to return to seasonal driving patterns after the holidays,” says Marie Dodds, public affairs director for AAA Oregon/Idaho. “Oregon and other West Coast states have been relatively insulated from these increases because of our distant location from the impacted refineries.”
2022 will go down as a record year with a national annual average of $3.96 and an Oregon annual average of $4.71. These are the highest annual averages ever.
The national average began 2022 at $3.29 on January 1 and ended the year at $3.20 on December 31. It peaked at $5.02 on June 14, 2022. The lowest price for the national average in 2022 was $3.10 on December 23.
The Oregon average began 2022 at $3.80 and ended the year at $3.74. It peaked at $5.55 on June 15, 2022. The lowest price for the Oregon average in 2022 was $3.74 on December 31.
Crude oil prices began 2023 around $80 per barrel. Crude prices have remained between about $71 and $81 for the last month. Crude reached a recent high of $122.11 per barrel on June 8. The all-time high for WTI crude oil is $147.27 in July 2008.
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 $76 per barrel compared to $78 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 due to holiday travel from 8.7 million b/d to 9.3 million b/d for the week ending December 23. This compares to 9.7 million b/d a year ago. Total domestic gasoline stocks fell by 3 million bbl to 223 million bbl. More demand and less supply pushed pump prices higher.
For the week, the national average for diesel adds a penny to $4.68 a gallon. The record high is $5.816 set on June 19. The Oregon average loses five cents to $4.79. The record high is $6.47 set on July 3. A year ago the national average for diesel was $3.57 and the Oregon average was $3.85.