According to AAA Oregon/Idaho, the national and Oregon gas price averages have been falling for 14 weeks in a row and are now at their lowest levels since early March.
The main causes of decreased pump prices include lower crude oil prices, weaker U.S. gas demand, and the changeover to winter mix fuel. The national average for regular drops three cents to $3.67 a gallon for the week. The average in Oregon decreases by four cents to $4.64.
On June 14, the national average hit a record high of $5.016, while on June 15, the Oregon average hit a record high of $5.548. Since then, both averages have been progressively falling.
According to Marie Dodds, public affairs director for AAA Oregon/Idaho, “the switch to less expensive winter-blend gasoline is putting a little more downward pressure on pump prices this month; however, some factors have the potential to push prices higher, including the ongoing war in Ukraine.
Refinery maintenance, and the possibility of a hurricane that would affect oil and gas infrastructure, refining, and transportation.” “Although AAA anticipates that gas prices will continue to fall over the fall months, it’s likely that prices may occasionally spike short,”
Since the majority of the nation is now using cheaper winter mix gasoline, small pump price reductions have taken place. Many refineries transition from summer-blend gasoline to winter-blend on September 15. Due to its lower Reid vapor pressure during the hot summer months, the summer-blend gas doesn’t evaporate as quickly and is therefore better for the environment. This changeover takes place on November 1 in California.
Due to worries about global economic slowdowns, crude oil prices have fallen from recent highs. On June 8, crude reached a recent high of $122.11 per barrel, and in July, it fluctuated between $94 and $110 per barrel. The price of crude was between $86 and $97 in August. Crude prices have ranged from roughly $81 to $89 per barrel so far in September.
Prior to and during the first few months of Russia’s invasion of Ukraine, crude prices sharply increased. Due to sanctions placed on Russia by the United States and other western countries, the world’s oil supplies are now more limited.
Russia is one of the leading suppliers of oil in the world, and its involvement in a war generates market instability. Globally, there were already limited oil supplies due to rising demand brought on by the relaxation of pandemic restrictions. Crude was about $70 per barrel a year ago, but it is now $84 per barrel.
Since crude oil is the primary component of gasoline and diesel, the price of crude on the international markets has an effect on pump pricing. According to the U.S. Energy Information Administration, the price of crude oil accounts for around 53% of the cost of a gallon of gasoline, followed by 12% for refining, 21% for distribution and marketing, and 15% for taxes.
Last week, the U.S. demand for gasoline dropped from 8.73 million b/d to 8.49 million b/d. Demand at this time last year was 8.89 million b/d, thus this is less than that. The U.S. Energy Information Administration reports that total domestic gasoline stockpiles decreased by 1.8 million barrels to 213 million barrels (EIA). Despite a decline in gasoline demand, pump prices have reduced less due to shifting oil prices. The national average will probably change when pump prices rise if oil prices climb.
Oregon is among the 37 states and the District of Columbia whose prices are lower now than they were a week ago, and nine states have experienced double-digit drops. The biggest weekly decrease was seen in Rhode Island (-14 cents). Nevada has the smallest (-2/10ths of a cent). Iowa has the biggest weekly increase (+14 cents). Wisconsin had the smallest weekly rise (up 2/10ths of a penny).
For the second consecutive week, California ($5.46) has the most expensive gas in the nation. The only two states with an average at or above $5 per gallon are still California and Hawaii ($5.27), which is unchanged from a week ago. 42 states and the District of Columbia have averages in the $3 range this week, while eight states, including Oregon, have averages at or over $4.
Mississippi and Louisiana have the nation’s lowest gas prices ($3.10 and $3.14 respectively). No state’s average is lower than $2 per gallon for the 89th week in a row.
49 states and the District of Columbia, including Oregon, have lower costs right now than they had one month ago. The national average is 23 cents lower than one month ago, and the average in Oregon is 18 cents lower.
The 13th-smallest monthly decline nationwide is in Oregon. The state with the biggest monthly decline in Connecticut (-60 cents). The only state to experience growth month over month is California (+12 cents). Only in Nevada is the pricing the same as it was one month ago.
Prices are up from a year ago in all 50 states plus the District of Columbia. The national average has increased by 48 cents, and the average in Oregon has increased by 89 cents from last year. This is the country’s fifth-largest annual rise. Hawaii has the largest annual rise ($1.21). The smallest rise from the previous year is in Colorado (+13 cents).
With all seven states ranking in the top 10, the West Coast region continues to have the highest pump prices nationwide. This is common for the West Coast, where supplies are frequently scarce and the use of gasoline is roughly equal to production.
Additionally, transportation expenses are greater in this area because it is relatively remote from the nation’s oil drilling, production, and refining centers. Additionally, the cost of production, storage, and distribution is increased by environmental policies in this region.
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