"Retail gas prices are holding fairly steady as crude oil prices remain below $80 per barrel. The national average drops three cents this week to $2.63 and Oregon's statewide average gains half a cent to $2.76." AAA Oregon Public Affairs Director Marie Dodds says, "We'll get a good idea of the mood of consumers next week during the Thanksgiving holiday as we see how many travelers hit the road for the four day weekend and how much is spent on gas, travel, and gifts as the holiday season kicks off."
Crude oil today is trading around $79 per barrel, same as last week. Oil spiked briefly above $80 in the past few weeks, but has mostly remained below that benchmark. The price of crude has rallied from below $33 last December. The weak dollar and investor optimism continue to be the major factors driving oil prices. As the dollar weakens, investors turn to more physical investments such as gold, oil and other commodities as ways to protect their investments. Also, crude is priced in dollars which means it becomes cheaper for foreign investors using other currencies whenever the dollar dips. Positive economic news tends to send crude prices higher as investors believe demand for oil will improve as the global economy recovers.
It appears the dollar won't improve dramatically in the short term. Federal Reserve Chairman Ben Bernanke this week suggested low interest rates, an ingredient that contributes to a weak dollar, will remain in place for some time.
At the same time, demand for oil is still weak and supplies remain vast. The amount of oil currently being held on large ocean going tankers is approaching ten year highs. Some estimates put the amount at as much as 143 million barrels of crude currently floating on ships in waters around the world. To put this in perspective, 143 million barrels is how much oil the U.S. consumes in an entire week.
Gasoline is more expensive now than it was a year ago when the global economy was in a tailspin. The national average was $2.09 and Oregon's was $2.25. Pump prices were falling an average of two cents a day before bottoming out in late December below $2 a gallon. So consumers can expect to pay roughly 60 cents more a gallon than during Thanksgiving 2008.
Two states have averages for regular unleaded at or above $3 a gallon, same as last week. Alaska is most expensive again this week with regular unleaded at $3.41, followed by Hawaii at $3.32, California at $2.95 (down from $2.98 last week), New York at $2.86, and Washington at $2.85 (holding steady and fifth most expensive for the fourth week in a row). Oregon is eighth most expensive, same as last week. Missouri has the least expensive gas for the second week in a row at $2.42.
Diesel prices are holding fairly steady. The national average drops a penny to $2.82, while Oregon’s average remains at $2.85. Hawaii has the highest statewide average price for diesel again this week at $3.96, followed by Alaska at $3.62, Connecticut at $3.05, New York at $3.03 and California at $3.01. Washington's average diesel price is $3.00 (down a penny and sixth highest again this week). Oregon's average is 23rd most expensive, up from 26th last week. A year ago, the national average for diesel was $2.97 and Oregon's average was $3.05.
