Are This Week’s Cheaper Gas Prices a Trick or a Long-Term Treat?

PORTLAND, Ore., – Pump prices in most states have been ticking lower for the past couple weeks but that may be just a temporary treat for drivers. For the week, the national average for regular drops four cents to $2.81 while Oregon’s average slips two cents to $3.36.

“AAA expects gas prices will likely start to increase as early as this week ahead of the Nov. 4 Iran sanctions and the midterm elections,” says Marie Dodds, public affairs director for AAA Oregon/Idaho. “Peak refinery season is wrapping up, which is helping to push gas prices lower, but declining prices are not expected to be a long-term trend. How high gas prices go will depend on how the markets react to the events in early November.”

Oregon is one of 45 states and the District of Colombia where prices have decreased week-over-week. Iowa has the largest weekly decrease (-8 cents). Ohio has the largest weekly increase (+7 cents). This week eight states have averages at or above $3 a gallon, down from 11 a week ago.

Oregon is one of seven states where prices are higher now than a month ago. The national average is seven cents less and the Oregon average is 10 cents more than a month ago. Michigan has the largest monthly decrease (-21 cents). Washington has the largest monthly increase (+13 cents). The West Coast states are the only ones with monthly increases due to a natural gas pipeline rupture in British Columbia, Canada three weeks ago. This forced three Puget Sound refineries to shut production units. Those refineries are now back online, but states on the West Coast saw spikes in gas prices due to the decreased output.

The West Coast continues to have the most expensive gas prices in the nation. Hawaii tops the list for the 21st week in a row with California, Washington, Alaska, Oregon, Nevada and Idaho rounding out the top seven. Oregon is fifth for the second week in a row. On the week, all the prices in the region except for Hawaii are lower.

Rank Region Price on 10/30/18
1 Hawaii $3.91
2 California $3.79
3 Washington $3.53
4 Alaska $3.38
5 Oregon $3.36
6 Nevada $3.29
7 Idaho $3.13
8 Utah $3.03
9 Pennsylvania $2.99
10 Montana $2.99

The Energy Information Administration’s (EIA) weekly petroleum status report for the week ending on October 19 showed West Coast gasoline stocks fell to 27 million bbl. Stocks are approximately 1.7 million bbl lower than at this time last year, which could cause prices to spike if there is a supply challenge in the region this week.

The nation’s cheapest markets are Delaware ($2.51) and South Carolina ($2.51). For the 65th week in a row, no states have an average below $2.

Drivers in all 50 states and the District of Columbia are paying more than a year ago to fill up. The national average is 34 cents more and the Oregon average is 61 cents more than a year ago. This is the fourth-largest yearly increase in the country. Hawaii (+76 cents) has the greatest year-over-year increase; California (+75 cents) is second; Washington (+61 cents) is third; and Nevada (+57 cents) is fifth.

 

Oil Market Dynamics

Crude oil prices have moved lower over the past several days after reports of rising supplies. The latest EIA weekly petroleum report showed crude inventories increased for the fifth consecutive week. Domestic crude inventories gained 6.3 million bbl to total 422.8 million bbl – a level not seen since the beginning of the driving season in June. If this week’s EIA report shows another substantial build in total crude inventories, prices are likely to face more downward pressure. However, U.S-imposed sanctions on Iran’s crude exports will take effect on Sunday, which may heighten fears in the market about reduced global supply amid growing global crude demand. At the same time, Saudi Arabia and Russia have said they’ll produce enough oil once U.S. sanctions on Iran go into effect.

At the close of Friday’s formal trading session on the NYMEX, WTI increased 26 cents to settle at $67.59. At the close of Monday’s formal trading session on the NYMEX, WTI lost 55 cents to settle at $67.04. Today crude is trading around $67, compared to $66 a week ago. Crude prices are down about 12 percent in the last month and are about $13 more per barrel 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.

Diesel

For the week, the national average falls a penny to $3.28 a gallon. Oregon’s average dips half a cent to $3.46. A year ago the national average for diesel was $2.74 and the Oregon average was $2.93.

 

Find current fuel prices at GasPrices.AAA.com.

AAA news releases, high resolution images, broadcast-quality video, fact sheets and podcasts are available on the AAA NewsRoom at NewsRoom.AAA.com.

Fuel prices are updated daily at AAA’s Daily Fuel Gauge at AAA Gas Prices. For more info go www.AAA.com. AAA Oregon/Idaho provides more than 800,000 members with travel, insurance, financial and automotive-related services, and is an affiliate of AAA National, serving more than 59 million motorists in North America.