Gas prices are climbing in most states, including Oregon, this week due to crude oil prices holding at six-month highs as well as refinery maintenance, especially on the West Coast. Crude oil prices have remained above $85 per barrel since April 2, mostly due to geo-political issues in the Middle East as well as drone strikes on Russian refineries. For the week, the national average for regular adds seven cents to $3.61. The Oregon average soars 12 cents to $4.41 a gallon. This is the ninth-largest weekly jump for a state in the nation.
Refinery maintenance is impacting at least three refineries in California: Chevron El Segundo in the Los Angeles area, Chevron Richmond in the San Francisco area, and PBF Martinez in the San Francisco area. The reduction in supplies is causing gas prices to soar on the West Coast, especially in Arizona (+27 cents week-over-week) and California (+25 cents week-over-week).
“We’re seeing significant refinery maintenance on the West Coast. The seasonal factors of refinery maintenance, the switch to summer-blend fuel and the increase in demand for gas are all at play, resulting in climbing pump prices,” says Marie Dodds, public affairs director for AAA Oregon/Idaho. “In addition, higher crude oil prices are also putting upward pressure on pump prices.”
The national and Oregon averages are at their highest prices since October.
Only two Oregon counties still have averages below $4 a gallon:
Baker $3.95
Malheur $3.98
The Oregon average began 2024 at $3.79 a gallon compared to $4.41 today. Its lowest price so far this year is $3.58 on February 14 and it has been steadily climbing since then. The national average started the year at $3.11 and is at $3.61 today. Its lowest price so far this year is just under $3.07 on January 15.
Gas prices always rise this time of year 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 switch 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 in February.
Crude oil prices have remained elevated due to geopolitical events around the world including increased volatility in the Middle East, drone attacks on Russian refineries, and Houthi militant attacks in the Red Sea. In addition, production cuts by OPEC+ has tightened global crude oil supplies.
Crude oil prices are at their highest since October. West Texas Intermediate climbed above $80 on March 14 and above $85 on April 2. A major driver is the Ukrainian attacks on Russian refineries. Russia is a top global oil producer and the refinery attacks have reduced output.
Crude prices were volatile after the attack on Israel by Hamas in October. While Israel and the Palestinian territory are not oil producers, there’ve been concerns 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 $85 today compared to $85 a week ago and $80 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 57% of what we pay for in a gallon of gasoline is for the price of crude oil, 14% is refining, 13% distribution and marketing, and 16% are taxes, according to the U.S. Energy Information Administration.
Demand for gas in the U.S. rose from 8.72 to 9.23 million b/d for the week ending March 29, according to the U.S. Energy Information Administration (EIA). This compares to 9.30 million b/d at the same time last year. Meanwhile, total domestic gasoline stocks decreased by 4.2 million bbl to 227.8 million bbl.
Higher demand and rising oil prices will likely nudge pump prices higher.
Quick stats
Oregon is one of 46 states and the District of Columbia with higher prices now than a week ago. Indiana (+28 cents) has the largest week-over-week gain in the nation. Arizona (+27 cents) and California (+25 cents) have the second- and third-largest weekly jumps. Oregon has the ninth-largest increase. Michigan (-7 cents) has the biggest weekly decline.
California ($5.37) has the most expensive gas in the nation for the sixth week in a row and is the only state in the nation with an average at or above $5 per gallon. Hawaii ($4.72) is second, Washington ($4.64) is third, Nevada ($4.58) is fourth, Oregon ($4.41) is fifth, Alaska ($4.25) is sixth, and Arizona ($4.07) is seventh. These are the seven states with averages at or above $4, up from six states a week ago. This week 43 states and the District of Columbia have averages in the $3-range. No states have averages in the $2 range this week.
The cheapest gas in the nation is in Colorado ($3.07) and Mississippi ($3.11). No state has had an average below $2 a gallon since January 7, 2021, when Mississippi and Texas were below that threshold.
The difference between the most expensive and least expensive states is $2.31 this week, compared to $2.05 a week ago.
Oregon is one of 49 states and the District of Columbia with higher prices now than a month ago. The national average is 21 cents more and the Oregon average is 48 cents more than a month ago. This is the sixth-largest monthly gain in the nation. Utah (+64 cents) has the largest monthly jump. Michigan (-4 cents) is the only state with a month-over-month decline.
Oregon is one of 20 states and the District of Columbia with higher prices now than a year ago. The national average is one cent more and the Oregon average is 42 cents more than a year ago. This is the second-largest yearly gain in the nation. California (+49 cents) has the largest year-over-year increase. Colorado (-39 cents) has the largest yearly decrease.
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 adds three cents to $4.05 a gallon. The record high is $5.816 set on June 19, 2022. The Oregon average rises four cents to $4.27. The record high is $6.47 set on July 3, 2022. A year ago the national average for diesel was $4.21 and the Oregon average was $4.60.
Source: AAA