AAA expects prices to keep falling
PORTLAND, Ore., – Retail gas prices are falling in all 50 states. For the week, the national average for regular unleaded slides six cents to $2.49 a gallon while the Oregon average drops three cents to $2.79. Prices nationally and in Oregon are showing double-digit drops from the year-to-date highs reached in September.
“Gas prices are expected to soon return to pre-hurricane rates. Pump prices have been steadily falling for the past month and now we’re seeing demand for gasoline drop as well. Demand is at the lowest point since the week Hurricane Harvey hit, which likely signals the start of a downward trend in demand and should lead to even lower pump prices in the coming weeks,” says Marie Dodds, public affairs director for AAA Oregon/Idaho.
The latest report from the Energy Information Administration (EIA) shows gasoline demand at 9.2 million b/d, down 281,000 b/d from the week prior. Hurricane Nate, which made landfall over the Gulf Coast before turning into a tropical depression, did not have a major impact on gas prices. Before the storm, many Gulf Coast oil platforms and rigs were shut down and employees evacuated, and two refineries were shut down. But early reports suggest little or no damage and operations were resuming this week.
Pump prices are lower in all 50 states and the District of Columbia week-over-week. The largest declines are in Georgia (-10 cents) and Michigan (-9 cents).
Oregon is one of 47 states and the District of Columbia where gas prices have fallen in the last month. The largest monthly decreases are in Delaware (-40 cents) and Kentucky (-32 cents). The national average is 19 cents less and the Oregon average is 13 cents less than a month ago. The only three states to see prices rise in the past month are Alaska (+4 cents), Hawaii (+1 cent) and Montana (+2/10 of a cent).
The West Coast still has the most expensive gas prices in the nation. Hawaii tops the list followed by California and Alaska. These three states all have averages at or above $3 a gallon. Washington and Oregon round out the top five. Oregon is fifth most expensive for the 15th week in a row.
|Rank||Region||Price on 10/10/2017|
|8||District of Columbia||$2.74|
Gasoline inventories on the West Coast have been steadily building for the past month. Recent reports from the EIA show West Coast gasoline supplies are about 1 million bbl above the year ago level and refinery utilization is at 93 percent. Above average gasoline inventory and elevated refinery rates have contributed to steady prices in the region.
The nation’s cheapest markets are Missouri ($2.19) and Oklahoma ($2.24). For the 11th 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 23 cents per gallon more and the Oregon average is 27 cents more than a year ago.
Oil Market Dynamics
Crude oil prices have been hovering around $50 per barrel for the past week. Last week’s EIA report showed that U.S. crude oil stocks fell by 6 million bbl since the end of September with almost 2 million bbl in exports and refinery utilization down half a percentage point to 88.1 percent of total capacity. Decreasing fall demand combined with ample supply and slowed U.S. production has kept downward pressure on crude oil prices.
While market watchers are keeping an eye on U.S. crude oil exports, attention is now focused on whether the Organization of Petroleum Exporting Countries (OPEC) will extend their reduced production agreement beyond their March 2018 deadline in order to drive crude oil prices higher. Over the weekend OPEC Secretary-General Mohammad Barkindo said Saudi Arabia and Russia are leading discussions among cartel members about the future of their agreement and whether or not an extension is necessary to maintain market rebalancing efforts. OPEC members are scheduled to meet again in Vienna on November 30 to assess the market and discuss plans moving forward. Since late last year, efforts by OPEC to rebalance the market have had positive impacts on prices helping to buoy crude oil above the 2016 low of $26.21.
West Texas Intermediate (WTI) crude oil teetered around the $50-dollar mark and just below all week, settling $1.50 lower at $49.29 per barrel at the close of Friday’s formal trading on the NYMEX.
At the close of Friday’s formal trading session on the NYMEX, WTI futures lost $1.50 to close at $49.29 per barrel. At the close of Monday’s session, WTI added 29 cents to settle at $49.58.Today crude is trading around $51, compared to $50 a week ago. Crude prices are up about six percent in the last month and are about the same price 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 prices are holding steady or ticking lower in most markets. For the week, the national average remains at $2.73 a gallon. Oregon’s average slips a penny to $2.94. A year ago the national average for diesel was $2.40 and the Oregon average was $2.54.
Find current fuel prices at GasPrices.AAA.com.
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