Relief expected in the next few weeks
PORTLAND, Ore., – “The Oregon average is edging lower and is now the fourth most expensive average in the country, behind Hawaii, Alaska and Washington. Last week, Oregonians had the third most expensive gasoline in the nation. This week, the national average for regular unleaded remains at $3.43 a gallon while Oregon’s average slips a penny to $3.88 per gallon.” AAA Oregon/Idaho Public Affairs Director Marie Dodds says, “Drivers in the Pacific states continue to pay the highest retail prices in the nation for regular unleaded. Drivers should get some relief soon now that Labor Day and the summer driving season are in the rearview mirror.”
The national average on Labor Day was $3.44 which is the lowest since 2010. Oregon’s Labor Day average of $3.88 was higher than last year but lower than 2012. Both the Oregon and national averages are below their year-to-date highs. The national average peaked at $3.70 a gallon on April 28. Oregon’s average reached its 2014 high of $3.99 on July 3.
Pump prices in the Pacific region have remained higher than in other parts of the country for much of the spring and summer. These regional highs reflect the lingering impact of refinery issues that have led to year-over-year premiums at the pump even as prices in much of the country reflect sizable yearly discounts.
The Pacific region is somewhat geographically isolated from the cheaper crude oil products that are available in the central U.S., and gasoline for California, the largest market in this region, must meet certain environmental specifications, making this gasoline more expensive to produce. If there are no additional refinery or distribution issues in the region, prices should start to ease in the next few weeks.
Demand for gasoline drops off after Labor Day when the busy summer driving season comes to an end. The switch to the cheaper winter blend gasoline begins September 15. These factors normally push pump prices lower. By the end of the year, the national average could fall as low as $3.30 a gallon by the end of the year. Potential spoilers include a hurricane in the Gulf of Mexico or geopolitical events.
While geopolitical developments in Ukraine and Iraq remain front page news, oil markets have marched steadily lower reflecting the assessment that global supplies remain unaffected. This slide in oil prices continued today as West Texas Intermediate (WTI) crude dropped $3.08 to $92.88 per barrel at the close of formal trading on the NYMEX. Today’s price marks a decline of more than $10 per barrel since the start of July and is the lowest settlement since January14. Crude prices are down about five percent over the last month.
This week there are two states with regular unleaded at or above $4 a gallon, same as last week: Hawaii and Alaska. For the 32nd week in a row, there are no states with an average below $3 per gallon, and no states within a dime of this mark for the 28th week in a row. However, South Carolina is just 16 cents away from $3.
Hawaii has the most expensive gas in the country for the 97th consecutive week at $4.28, followed by Alaska at $4.02, Washington at $3.88 (same price as last week and third most expensive after two weeks at fourth), Oregon at $3.88 (down a penny and fourth after two weeks at third), and California at $3.84 (down three cents and fifth for the third consecutive week). Idaho is sixth for the second week in a row at $3.75 (down two cents). South Carolina has the cheapest gas in the country for the 11th week in a row at $3.16 a gallon (up a penny).
Diesel prices are ticking down in many markets but moving up in the Pacific Northwest. The national average slips a penny to $3.80 a gallon. Oregon’s average jumps six cents to $3.99. Diesel is at or above $4 a gallon in six states for the fourth week in a row. Hawaii is most expensive at $4.86, followed by Connecticut at $4.15, Alaska at $4.13, New York at $4.13, and California at $4.09 (down a penny). Washington is sixth for the fifth consecutive week at $4.07 (up six cents). Idaho is 10th for the second week in a row up from 11th at $3.93 (down a penny). Oregon is seventh up from 11th last week. A year ago, the national average for diesel was $3.93 and Oregon’s was $3.94.