Gas prices in most states, including Oregon, are moving lower as autumn begins. But refinery issues in other states, notably California, have caused prices to climb in those areas. Crude oil prices have declined slightly, helping to put some downward pressure on pump prices. However, refinery maintenance has the potential to send pump prices higher in some areas. For the week, the national average falls four cents to $3.84. The Oregon average loses three cents to $4.67.
The national average reached its highest price of the year on September 18 at $3.881. The year-to-date high for the Oregon average is $4.771 on August 30.
“Refinery maintenance and issues have caused pump prices to rise in California, Nevada and Arizona. Other areas should see gas prices continue to move lower, unless new refinery issues crop up, and if crude prices don’t surge again,” says Marie Dodds, public affairs director for AAA Oregon/Idaho.
This is the time of year that the switch to winter-blend fuel occurs, and refinery maintenance is often done at the same time. The switch happened on September 15 in all states except California, where it occurs on October 31. Winter-blend gas is cheaper to produce than summer-blend fuel, so gas prices normally decline when the switch occurs. Summer-blend gas helps reduce emissions from gasoline during the warm summer months. More info on summer- and winter-blend gasoline can be found at the EPA website.
Crude oil prices surged above $90 per barrel in mid-September, the highest price since last November, in response to the announcement from Saudi Arabia and Russia that they would keep their production cuts in place through 2023. The cuts are one million barrels a day by Saudi Arabia and 300,000 barrels a day by Russia.
Crude oil is trading around $90 today compared to $91 a week ago and $77 a year ago. In August, West Texas Intermediate ranged between about $77 and $85 per barrel. In July, West Texas Intermediate ranged between about $69 and $82 per barrel. In June, WTI ranged between about $67 and $73 per barrel. In May, WTI ranged between about $63 and $77 per barrel. In April, WTI ranged between about $73 and $83. In March, WTI ranged between about $64 and $81 per barrel. In February, WTI ranged between about $73 and $80 per barrel. In January, WTI ranged between about $73 and $82 bbl. 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 50% of what we pay for in a gallon of gasoline is for the price of crude oil, 25% is refining, 11% distribution and marketing, and 14% are taxes, according to the U.S. Energy Information Administration.
Demand for gasoline rose slightly from 8.31 to 8.41 million b/d for the week ending September 15, according to the U.S. Energy Information Administration (EIA). This compares to 8.32 million b/d a year ago. Meanwhile, total domestic gasoline stocks declined slightly from 220.3 to 219.5 million bbl. Higher gas demand, amid tighter supply, has contributed to elevated pump prices, but oil remaining above $90 per barrel continues to steer the price increases seen by drivers.
Oregon is one of 45 states and the District of Columbia with lower prices now than a week ago. Delaware (-16 cents) has the biggest weekly decrease. Indiana (+11 cents), Nevada (+10 cents), and California (+8 cents) have the largest weekly gains.
California ($5.84) has the most expensive gas in the nation for the ninth week in a row. Nevada ($5.12) is second, and Washington ($5.03) is third. These are the three states with averages at or above $5 a gallon. Hawaii ($4.88) is fourth, Oregon ($4.67) is fifth, Arizona ($4.65) is sixth, Alaska ($4.59) is seventh, Utah ($4.21) is eighth, Montana ($4.20) is ninth, and Idaho ($4.13) is 10th. These are the 10 states with averages at or above $4 a gallon, down from 11 states a week ago. This week 40 states and the District of Columbia have averages in the $3-range. No state has an average in the $2 range this week.
The cheapest gas in the nation is in Mississippi ($3.26) and Georgia ($3.29). For the 141st week in a row, no state has an average below $2 a gallon.
The difference between the most expensive and least expensive states is $2.58 this week, compared to $2.46 a week ago.
Oregon is one of 28 states and the District of Columbia with lower prices now than a month ago. The national average is two cents more and the Oregon average is seven cents less than a month ago. Nevada (+63 cents), California (+57 cents) and Arizona (+36 cents) have the largest monthly jumps. Georgia (-29 cents) has the largest monthly drop.
Oregon is one of only nine states with lower prices now than a year ago. The national average is 11 cents more and the Oregon average is 34 cents less than a year ago. This is the second-largest yearly drop in the nation. Hawaii (-36 cents) has the largest yearly decrease. Arizona (+54 cents) has the largest year-over-year increase.
The West Coast region continues to have the most expensive pump prices in the nation with all 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.
As mentioned above, California has the most expensive gas in the country. Nevada, Washington, Hawaii, Oregon, Arizona, and Alaska, round out the top seven. Oregon is fifth for the second consecutive week.
Nevada (+10 cents), California (+8 cents), Hawaii (+6 cents) and Arizona (+4 cents) are seeing week-over-week increases. Oregon (-3 cents), Alaska (-3 cents) and Washington (-1 cent) have week-over-week declines.
The refinery utilization rate on the West Coast rose from 90.0% to 93.1% for the week ending September 15. This rate has ranged between about 73% to 96% in the last year. The latest national refinery utilization rate decreased from 93.7% to 91.9%.
According to EIA’s latest weekly report, total gas stocks in the region increased slightly from 28.19 million bbl. to 28.28 million bbl.
A higher refinery utilization rate and an increase in gasoline stocks can put downward pressure on pump prices. However, crude oil prices around $90 per barrel put upward pressure on pump prices.
Oil market dynamics
Crude oil prices remain around $90 per barrel but have edged lower from last week’s highs above $91 due to ongoing market concerns that energy demand could be lowered if future interest rate increases tip the U.S. economy into a recession. Additionally, prices declined despite the EIA reporting that total commercial crude stocks decreased by 2.1 million bbl to 418.5 million bbl last week.
At the close of Friday’s formal trading session, WTI added 40 cents to settle at $90.03. At the close of Monday’s formal trading session, WTI slipped 35 cents to settle at $89.68. Today crude is trading around $90 compared to $91 a week ago. Crude prices are about $11 more than a year ago.
Drivers can find current gas prices along their route with the free AAA Mobile app for iPhone, iPad and Android. The app can also be used to map a route, find discounts, book a hotel and access AAA roadside assistance. Learn more at AAA.com/mobile.
For the week, the national average dips a penny to $4.57 a gallon. The record high is $5.816 set on June 19, 2022. The Oregon average ticks down two cents to $5.22. The record high is $6.47 set on July 3, 2022. A year ago the national average for diesel was $4.90 and the Oregon average was $5.45.