Pump prices continue to fall for now. Demand for gas in the U.S. is rising and supplies are tighter; however, lower crude oil prices are helping to put downward pressure on pump prices. Most states, including Oregon, are seeing gas prices fall for the 10th week in a row. For the week, the national average for regular declines six cents to $3.89 a gallon. The Oregon average slips four cents to $4.82.
The national average reached its record high of $5.016 on June 14 while the Oregon average reached its record high of $5.548 on June 15. Both averages have been steadily declining since then. The major drivers of lower pump prices have been falling crude oil prices and a few weeks of seasonally low demand for gas.
“Demand for gas in the U.S. has been ticking up after a few weeks of seasonally low demand for gas that were likely due to the record high pump prices we saw this spring. Increasing demand and hurricane season have the potential to send pump prices higher,” says Marie Dodds, public affairs director for AAA Oregon/Idaho. “Any storms that disrupt oil production in the Gulf of Mexico and impact large coastal refineries can impact fuel prices.”
A recent survey from AAA showed that Americans have changed their driving habits to cope with high gas prices. Almost two-thirds (64%) of U.S. adults have changed their driving habits or lifestyle since March, with 23% making “major changes.” Drivers’ top three changes to offset high gas prices are driving less, combining errands, and reducing shopping or dining out. Other changes include delaying major purchases, postponing vacations and saving less money.
Find complete results in the AAA consumer gas price survey news release.
Demand for gasoline in the U.S. rose slightly from 9.12 million b/d to 9.35 million b/d last week, which is nearly identical to this time last year. Total domestic gasoline stocks decreased by nearly 5 million bbl to 215.7 million bbl., according to the U.S. Energy Information Administration (EIA). Although gasoline demand has risen and supplies have tightened, easing oil prices have helped lower pump prices. If oil prices edge lower, drivers will likely see falling pump prices.
Crude oil prices have tumbled from recent highs due to fears of economic slowdowns elsewhere around the globe. Crude reached a recent high of $122.11 per barrel on June 8, and ranged from about $94 to $110 in July. This month, crude has ranged between about $87 and $94. Crude prices rose dramatically leading up to and in the first few months of Russia’s invasion of Ukraine. Russia is one of the world’s top oil producers and its involvement in a war causes market volatility, and sanctions imposed on Russia by the U.S. and other western nations resulted in tighter global oil supplies. Oil supplies were already tight around the world as demand for oil increased as pandemic restrictions eased. A year ago, crude was around $67 per barrel compared to $93 today.
Crude oil is the main ingredient in gasoline and diesel, so pump prices are impacted by crude prices on the global markets. On average, about 53% of what we pay for in a gallon of gasoline is for the price of crude oil, 12% is refining, 21% distribution and marketing, and 15% are taxes, according to the U.S. Energy Information Administration.
Consumers can still enjoy a tasty AAA gas price–related treat courtesy of Krispy Kreme Doughnuts. Running every Wednesday through Labor Day, Krispy Kreme will lower the price of a dozen Original Glazed donuts to the national average that AAA reports each Monday. A dozen glazed doughnuts typically cost around $12. This Wednesday’s dozen should cost $3.90, not including sales tax, and is available only in shop, drive-thru, or online pickup.Pump
