PORTLAND, Ore., – A huge jump in U.S. gasoline stocks is putting downward pressure on retail gas prices. For the week, the national average for regular drops six cents to $2.64 a gallon. The Oregon average loses four cents to $3.10.
The latest data from the U.S. Energy Information Administration shows that gasoline stocks built by a surprising 4.4 million bbl. Contributing to the build was at least 1.2 million b/d of imports at U.S. ports. With the large bump, stocks now sit 235 million bbl – a U.S. stock level not seen since the end of March. Meanwhile, gas demand grew slightly from 9.55 million b/d to 9.65 million b/d.
“The major jump in gasoline stocks is contributing to drops in pump prices this week, even though demand remains strong. If total domestic stocks continue to outpace demand, AAA expects pump prices to fall even more this summer, barring a major hurricane or other unexpected event,” says Marie Dodds, public affairs director for AAA Oregon/Idaho.
Oregon is one of 49 states and the District of Columbia where prices are lower now than a week ago. Ohio (-17 cents) has the largest weekly drop. Almost half of all states (23) have declines of a nickel or more. Arizona is the only state with a weekly increase and it is only three-tenths of a cent. This week there are six states with an average above $3 a gallon, same as a week ago.
Oregon is one of 48 states and the District of Columbia with lower prices now than a month ago. The national average is 14 cents less and the Oregon average is 11 cents less than a month ago. This is the 24th-largest monthly decline in the nation. Indiana (-37 cents) has the largest month-over-month decline. Utah (+1/2 cent) and Hawaii (+3/10 cent) are the only states with monthly increases and they are both less than one cent.
Oregon is one 48 states and the District of Columbia where drivers are paying less than a year ago. The national average is 21 cents less and the Oregon average is 17 cents less than a year ago. Delaware (-37 cents) has the largest year-over-year drop. California (+1 cent) and Nevada (+1/2 cent) are the only states with year-over-year increases.
The West Coast continues to have the highest pump prices in the nation with all of the region’s states except Arizona landing on the top 10 most expensive list.
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After 20 weeks as the most expensive state in the nation, California falls to second, and Hawaii moves up to the top spot. Washington, Nevada, Oregon and Alaska round out the top six. Oregon is fifth most expensive for the fourth week in a row.
Most state averages in the region have decreased on the week, with California (-5 cents) and Oregon (-4 cents) seeing the largest declines. As noted above, Arizona (+3/10 cent) is the only state in the nation with a weekly increase.
The EIA’s recent report for the week ending on August 2 showed that West Coast gasoline stocks sit at 31.7 million bbl, growing by approximately 500,000 bbl from the previous week. The current level is nearly 1.3 million bbl higher than last year at this time, which could help prices stabilize if there is any disruption in supply or an increase in gas demand in the region this week.
The cheapest gas in the nation can be found in Louisiana ($2.27) and Mississippi ($2.28). For the 26th week in a row, no states have an average below $2 a gallon.
Oil market dynamics
Crude prices moved higher last week after reports that OPEC is considering additional crude production cuts. In July, the cartel announced that it and its partners would extend the 1.2 million b/d crude production reduction agreement for an additional nine months. More details about the potential production cuts will likely be discussed at OPEC’s next meeting on December 5 and 6 in Vienna. Crude prices could increase this week amid further indications that global crude supply will tighten this fall.
The increase in crude prices last week occurred despite the International Energy Agency (IEA) revealing that global oil demand from May 2018 to January 2019 grew at its slowest rate since 2008. As a result, IEA reduced its global crude demand growth forecasts for 2019 and 2020 to 1.1 million and 1.3 million bpd respectively.
At the close of Friday’s formal trading session on the NYMEX, WTI increased by a $1.96 to settle at $54.50. At the close of Monday’s formal trading session on the NYMEX, WTI added 43 cents to $54.93. Today crude is trading around $57, compared to $54 a week ago. Crude prices are down about three percent in the last month and are about $13 per barrel less 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.
For the week, the national average slips two cents to $2.96 a gallon. Oregon’s average also loses two cents to $3.16. A year ago the national average for diesel was $3.15 and the Oregon average was $3.40.
Find current fuel prices at GasPrices.AAA.com.
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