Pump Prices Back Away from two-year Highs

Oregon one of 46 states to see prices drop week-over-week

PORTLAND, Ore., – Retail gas prices are slowly receding as the South and Southeast states recover from Harvey and Irma. This week 46 states including Oregon are reporting lower prices than a week ago. But pump prices remain near year-to-date highs and the highest prices since August 2015. For the week, the national average for regular unleaded slips a penny to $2.66 while the Oregon average ticks down two cents to $2.92.

2017 year to date highs 9-19-2017

“Major gas price hikes appear to be in the rearview mirror as refineries, pipelines and gasoline deliveries resume more normal operations,” says Marie Dodds, public affairs director for AAA Oregon/Idaho. “Still, drivers can expect volatile prices over the next couple of weeks, as demand remains significant in the wake of the storms.”

OR local-national 9-19-17

Hurricanes Jose and Maria are not expected to have major impacts on gas prices as they are not expected to enter the Gulf of Mexico. Hurricane season ends on November 30.

As gas prices move lower in most states, the nation’s gasoline inventory is also shrinking. The latest Energy Information Administration (EIA) report identifies the latest draw of 8.4 million bbl as the highest on record, much of which can be attributed to motorist fueling up in the droves in anticipation of Hurricane Irma. “The next report may also show record demand levels, but demand is expected to sharply decline by the end of this month and into October,” says Dodds.

Oregon is one of 46 states where prices decreased in the last week. The largest drop is in Indiana (-17 cents). The largest increase is in Alaska (+4 cents).

All 50 states and the District of Columbia have higher prices now than a month ago. The largest monthly increases are in Georgia (+50 cents), Florida (+45 cents) and South Carolina (+44 cents). Oregon has one of the lowest monthly increases—the 45th largest in the country—at 12 cents. The national average is 28 cents more than a month ago.

The West Coast continues to have the most expensive gas prices in the nation. For the third week in a row, California tops the list, with Hawaii, Washington, Alaska and Oregon rounding out the top five most expensive states. Alaska becomes the fourth state to have an average at or above $3 per gallon. Oregon is fifth most expensive for the 12th week in a row.

Rank Region Price on 9/19/2017
1 California $3.15
2 Hawaii $3.12
3 Washington $3.05
4 Alaska $3.00
5 Oregon $2.90
6 Pennsylvania $2.86
7 Connecticut $2.85
8 District of Columbia $2.85
9 New York $2.81
10 Nevada $2.80

Unlike regions east of the Mississippi, the West Coast region saw an increase in gasoline inventory by a moderate 750,000 bbl.

Still, pump prices in this region are volatile and have moved up this week in half of the West Coast states: Alaska (+4 cents), Hawaii (+1 cent), Arizona (+1 cent) and Washington (+1/2 cent). Oregon (-2 cents), Nevada (-1 cent) and California (-1 cent) saw prices decline.

The nation’s cheapest markets are Oklahoma ($2.31) and Missouri ($2.33). For the eighth week in a row, no states have an average below $2.

Drivers are paying more to fill up compared to one year ago. The national average is currently 41 cents per gallon more and the Oregon average is 37 cents more than a year ago.

Oil Market Dynamics

Last week, the price per barrel of WTI gained about five percent but still remains below $50 per barrel. Since Hurricanes Harvey and Irma hit the U.S., oil prices have not spiked like gasoline prices did despite a quarter of the refining capacity in the country being offline due to Harvey. As refineries work to reach pre-storm capacity levels, oil inventories may decline in the coming weeks as refineries turn to storage tanks to meet demand needs. Given that the fall driving season tends to be less demand-driven, any declines in inventories are likely to keep pace with demand.

As expected, EIA’s report last week showed a drop in crude input flows to 14.4 million b/d, illustrating that refineries affected by Harvey are taking in less oil as they resume normal operations. Any indication that the U.S. supply appears to be tightening could lead oil prices to rise. Moreover, falling by seven rigs last week, Baker Hughes reports that active oil rigs in the U.S. sit at 749.

At the close of Friday’s formal trading session on the NYMEX, WTI futures remained unchanged at $49.89. At the close of Monday’s session, WTI added two cents to settle at $49.91.Today crude is trading around $49, compared to $48 a week ago. Crude prices are up about five percent in the last month and are about $7 per barrel more 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

Diesel prices continue to tick up in many markets. For the week, the national average remains at $2.72 a gallon. Oregon’s average rises a penny to $2.94. A year ago the national average for diesel was $2.36 and the Oregon average was $2.55.

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Find current fuel prices at GasPrices.AAA.com.

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