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Jul-02-2014 08:50TweetFollow @OregonNews
Salem Gas Prices Jump 3 Cents; Oregon Nears $4 Dollars a GallonSalem-News.com Staff
Salem area average gas prices in the past week have jumped 3-cents to $3.98.
(PORTLAND, Ore. ) - The majority of drivers in the U.S. will pay the most expensive gas prices for the 4th of July holiday since 2008, primarily because violence in Iraq has sent global crude oil prices higher.
"The national average for regular unleaded slips a penny this week to $3.67 a gallon. Oregon’s average gains a penny to $3.98 which is the year-to-date high.” AAA Oregon/Idaho Public Affairs Director Marie Dodds says, “Gas prices often decrease in June as refineries complete maintenance and increase gasoline production in anticipation of the summer driving season. That didn’t happen this year due to the unexpected events in Iraq, and most drivers are paying about 15 to 20 cents more per gallon than expected as we head into the busy Independence Day travel weekend.”
The national average reached its year-to-date high of $3.70 on April 28. The Oregon average could breach $4 a gallon given the global run-up in crude oil prices, but unless there’s a major disruption to supply in the Middle East, prices are not expected to climb much higher than that. The last time Oregon’s average was at or above $4 per gallon was on Oct. 20, 2012.
Drivers in Hawaii, California, Alaska and Washington are paying more than $4 per gallon for regular unleaded. The Evergreen State reached the $4 mark last Friday, June 27 for the first time since May 24, 2013. California, Washington and Oregon are all in the top 5 most expensive states. California is second, Washington is fourth and Oregon is fifth.
Regardless of geographic location, motorists in nearly every state are paying more at the pump than one year ago. Motorists in 40 states and Washington, D.C., are experiencing a bit of sticker shock, with prices up a dime or more compared to this time last year. This largest increases are in Michigan (+42 cents), Kentucky (+37 cents) and Ohio (+30 cents). However, four states are outside of this trend and have posted year-over-year declines: Colorado (-0.1 cent), Montana (-1 cent), Idaho (-6 cents) and Utah (-8 cents).
Gas prices this July will likely remain expensive due to high crude oil costs and rising summertime demand. AAA expects the national average price of gas in July will range from $3.60 to $3.70 per gallon, and Oregon’s average will be around $3.80 to $4.00. Prices could climb higher if there are new developments in Iraq or a major hurricane. Last year gas prices averaged $3.58 per gallon nationally in July.
Energy market analysts continue to monitor the situation in Iraq and the movements of the group ISIL (Islamic State of Iraq and the Levant). After capturing Mosul, Iraq’s second largest city, it was rumored that ISIL would enter Baghdad or the country’s southern oil producing. These concerns caused global prices to rise, but, many analysts now see this action as unlikely in the near term barring a major offensive move by ISIL.
The conversation regarding domestic production was revived this week when two Texas energy companies received permission to export ultra-light oil to foreign buyers. The decision relates to a decades-long ban on crude exports, enacted in response to the 1973 OPEC oil embargo and the historic gasoline shortages of the 1970s. The move falls short of relaxing the ban on oil exports, which oil producers have called for, and will remain a topic of discussion in the coming months.
Crude oil prices remain above $100 per barrel. At the close of Monday’s formal trading on the NYMEX, West Texas Intermediate (WTI) crude oil settled 37 cents lower at $105.37. Today WTI is trading around $105 compared to $106 a week ago. Crude prices are up about two percent over the last month, and are about $9 a barrel more than a year ago.
This week there are four states with regular unleaded at or above $4 a gallon, up from three last week: Hawaii, California, Alaska and Washington. For the 23rd 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 19th week in a row.
Hawaii has the most expensive gas in the country for the 88th consecutive week at $4.34, followed by Alaska at $4.22, California at $4.14 (up three cents and down from second most expensive last week), Washington at $4.01 (up two cents and fourth most expensive for the fourth week in a row), and Oregon at $3.98 (up a penny and up from sixth last week).
Idaho is 19th up from 23rd last week at $3.71 (up two cents). South Carolina has the cheapest gas in the country for the second week in a row at $3.39 a gallon (down two cents).
Diesel prices are holding fairly steady in most markets. The national average remains at $3.90 a gallon this week. Oregon’s average adds a penny to $3.98. Diesel is at or above $4 a gallon in 12 states (including the District of Columbia), same as last week. Hawaii is most expensive at $4.86, followed by Connecticut at $4.34, Alaska at $4.28, New York at $4.28, and California at $4.17 (up two cents).
Washington is seventh for the second week in a row at $4.09 (up a penny). Idaho is 18th down from 13th at $3.98 (down a penny). Oregon is 17th up from 20th last week. A year ago, the national average for diesel was $3.82 and Oregon's was $3.88.
Salem area average gas prices in the past week have jumped 3-cents to $3.98. Last month prices were at $3.86, and one year ago the average price was $3.63.
Source: AAA Oregon
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