Refinery issues in California sent gas prices soaring on the West Coast. The California average skyrocketed above $6 a gallon. California has allowed the switch to winter blend gas earlier than its normal October 31 date and that has helped prices to settle down. For the week, the national average falls four cents to $3.80. The Oregon average jumps nine cents to $4.76.
“Tight supplies from refinery issues in California have impacted the West Coast region. With California now allowing winter-blend fuel earlier than usual, gas prices are heading lower. However, crude oil prices stubbornly remain around $90 per barrel, a factor in keeping gas prices elevated at a time of year when they normally decline,” says Marie Dodds, public affairs director for AAA Oregon/Idaho.
Winter-blend gas is cheaper to produce than summer-blend fuel as it contains ingredients such as butane, 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. The switch occurs on September 15 except California, which normally keeps summer-blend gasoline until October 31.
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 $90 a week ago and $84 a year ago. In September, West Coast Intermediate ranged between about $85 and $94 per barrel. In August, WTI 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 8.41 to 8.62 million b/d for the week ending September 22, according to the U.S. Energy Information Administration (EIA). This compares to 8.83 million b/d a year ago. Meanwhile, total domestic gasoline stocks increased by 1 million bbl to 220.5 million bbl. Growing supply and tepid demand have pushed prices lower in many states. Still, fluctuating oil prices have limited seasonal price decreases typically seen as the country settles into the lower-demand fall driving season.
Quick stats
Oregon is one of only six states with higher prices now than a week ago. California (+18 cents) and Washington (+10 cents) have the biggest weekly jumps. Iowa (-17 cents) has the largest weekly drop.
California ($6.02) has the most expensive gas in the nation for the 10th week in a row and is the only state with an average above $6 a gallon. Washington ($5.13) is second, and Nevada ($5.12) is third. These are the three states with averages at or above $5 a gallon. Hawaii ($4.88) is fourth, Oregon ($4.76) is fifth, Arizona ($4.64) is sixth, Alaska ($4.63) is seventh, Idaho ($4.13) is eighth, Utah ($4.13) is ninth, and Montana ($4.09) is 10th. These are the 10 states with averages at or above $4 a gallon, the same number of states as 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 ($3.22) and Georgia ($3.23). For the 142nd week in a row, no state has an average below $2 a gallon.
The difference between the most expensive and least expensive states is $2.80 this week, compared to $2.58 a week ago.
Oregon is one of 17 states with higher prices now than a month ago. The national average is one cent less and the Oregon average is two cents more than a month ago. California (+70 cents), Nevada (+58 cents), and Arizona (+31 cents) have the largest monthly jumps. Georgia (-38 cents) has the largest monthly drop.
Oregon is one of 15 states with lower prices now than a year ago. The national average is the same and the Oregon average is 68 cents less than a year ago. This is the second-largest yearly drop in the nation. Alaska (-71 cents) has the largest yearly decrease. Connecticut (+51 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 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.
Diesel
For the week, the national average dips a penny to $4.56 a gallon. The record high is $5.816 set on June 19, 2022. The Oregon average loses five cents to $5.17. The record high is $6.47 set on July 3, 2022. A year ago the national average for diesel was $4.87 and the Oregon average was $5.45.
Source: AAA