Gas prices are climbing in most states including Oregon because of the attacks between Israel and Iran. The conflict caused crude oil prices to spike to their highest prices since January on concerns that the conflict could impact global oil supplies. Expect oil and gas prices to be volatile as long as this conflict continues. For the week, the national average for regular adds five cents $3.17 a gallon. The Oregon average gains four cents to $4.01 a gallon.

“The prices we pay at the pumps are in direct correlation to the price of crude oil, and geopolitical events such as this conflict between Israel and Iran remind us of that. Iran is an oil producer and part of the OPEC+ cartel,” says Marie Dodds, public affairs director for AAA Oregon/Idaho.

The Oregon average began 2025 at $3.45 a gallon and is currently at $4.01. The highest price of the year so far is $4.02 on May 28. The lowest price of the year so far is just under $3.45 a gallon on January 2.

The national average began 2025 at $3.06 a gallon and is currently at $3.17. The highest price of the year so far is $3.27 on April 4. The lowest price of the year so far is $3.06 on January 5.

This week 15 Oregon counties have averages at or above $4, up from 12 a week ago.

Clackamas $4.04
Clatsop $4.10
Columbia $4.23
Curry $4.04
Grant $4.09
Harney $4.20
Jackson $4.07
Josephine $4.11
Lake $4.24
Multnomah $4.12
Tillamook $4.13
Wallowa $4.
Wasco $4.11
Washington $4.11
Yamhill $4.03

Gas prices typically rise starting in mid-to-late winter and early spring as refineries undergo maintenance ahead of the switch to summer-blend fuel, which is more expensive to produce and less likely to evaporate in warmer temperatures. The switch occurs first in California, which is why pump prices on the West Coast often rise before other parts of the country. The East Coast is the last major market to switch to summer-blend fuel. Most areas have a May 1 compliance date for refiners and terminals, while most gas stations have a June 1 deadline to switch to selling summer-blend until June 1. Switch-over dates are earlier in California with some areas in the state requiring summer-blend fuel by April 1. Some refineries will begin maintenance and the switchover in February.

Gas prices usually drop in the fall, due to the switch from summer-blend to winter-blend fuel, which costs less to produce. The switch starts in September. Many areas, including Oregon, can sell winter-blend fuel starting September 15. However, Northern and Southern California require summer-blend fuel through October 31. Prices usually decline to their lowest levels of the year in late fall and early winter before increasing again in the late winter and early spring.

Meanwhile, crude oil production in the U.S. remains near record highs. The U.S. Energy Information Administration (EIA) reports that crude production in this country increased slightly from 13.41 to 13.42 million barrels per day for the week ending June 6. The record high is 13.63 million barrels per day for the week of December 6. Production has been at 13.5 million barrels per day many times since October. The U.S. has been the top producer of crude oil in the world since 2018 and has been increasing its oil production since about 2009.

The U.S. price of crude oil (West Texas Intermediate) had been mostly in the upper $60s to mid-$70s since last September. Crude prices spiked to the low $70s last week in response to the strikes between Israel and Iran. Crude prices fell in early April as markets reacted to President Trumps tariffs and the impact on U.S. and global markets. Additional downward pressure on crude prices came after the decision by OPEC+ to increase production. The lowest closing price since September was $57.13 on May 5, which was the lowest closing price since February 2021. The recent high price for crude was $80.04 per barrel on January 15, which was the highest price since last August.

Crude oil is trading around $73 today compared to $65 a week ago and $80 a year ago. In 2024, West Texas Intermediate ranged between $66 and $87 per barrel. In 2023, WTI ranged between $63 and $95 per barrel. WTI reached recent highs of $123.70 on March 8, 2022, shortly after the Russian invasion of Ukraine, and $122.11 per barrel on June 8, 2022. The all-time high for WTI crude oil is $147.27 in July 2008.

Crude prices are impacted by economic news as well as geopolitical events around the world including the current economic uncertainty, unrest in the Middle East including the recent strikes between Israel and Iran, and the war between Russia and Ukraine. Russia is a top global oil producer, behind the U.S. and Saudi Arabia. Crude prices have been volatile after the attack on Israel by Hamas in October 2023. While Israel and the Palestinian territory are not oil producers, concerns remain that the conflict could spread in the Middle East, which could potentially impact crude production in other oil-producing nations in the region. In addition, production cuts by OPEC+ in previous years tightened global crude oil supplies, which continued to impact prices. But now the cartel boosted production by 411,000 barrels in May and June, and announced the same increase for July.

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 49% of what we pay for in a gallon of gasoline is for the price of crude oil, 16% is refining, 19% distribution and marketing, and 16% are taxes, according to the U.S. Energy Information Administration.

Demand for gasoline in the U.S. increased from 8.26 million b/d to 9.17 for the week ending June 6, according to the U.S. Energy Information Administration (EIA). This compares to 9.04 million b/d a year ago. Meanwhile, total domestic gasoline supply increased from 228.3 million barrels to 229.8. Gasoline production increased last week, averaging 9.7 million barrels per day, compared to 9.0 million barrels daily the previous week.

Pump prices will likely rise in the short term, due to higher crude oil prices.

Quick stats

Oregon is one of 48 states with higher prices now than a week ago. Delaware (+17 cents) has the biggest week-over-week increase in the nation. California (-4 cents), Hawaii (-2 cents) and the District of Columbia (-1/10th of a cent) are the only areas with week-over-week declines.

California ($4.65) has the most expensive gas in the nation for the 18th week in a row. Hawaii ($4.46) is second, Washington ($4.39) is third, and Oregon ($4.01) is fourth. These are the four states in the country with averages at or above $4 a gallon. This week 27 states and the District of Columbia have averages in the $3-range. There are 19 states with an average in the $2 range this week.

The cheapest gas in the nation is in Mississippi ($2.67) and Louisiana ($2.76). No state has had an average below $2 a gallon since January 7, 2021, when Mississippi and Texas were below that threshold. At the time, the COVID-19 pandemic drove significant declines in crude oil and gasoline demand in the U.S. and around the world.

The difference between the most expensive and least expensive states is $1.98 this week, compared to $2.06 a week ago.

Oregon is one of 28 states with higher prices now than a month ago. The national average is two cents less and the Oregon average is five cents more than a month ago. California (-27 cents) has the largest month-over-month drop in the nation. Delaware (+9 cents) has the largest month-over-month increase.

Oregon is one of 49 states and the District of Columbia with lower prices now than a year ago. The national average is 28 cents less and the Oregon average is nine cents less than a year ago. The District of Columbia (-48 cents) has the largest yearly drop. Washington (+5 cents) is the only state with a year-over-year increase.

West Coast

The West Coast region continues to have the most expensive pump prices in the nation with six of the seven states in the top 10. It’s typical for the West Coast to have six or seven states in the top 10 as this region tends to consistently have fairly tight supplies, consuming about as much gasoline as is produced. In addition, this region is located relatively far from parts of the country where oil drilling, production and refining occurs, so transportation costs are higher. And environmental programs in this region add to the cost of production, storage and distribution.

As mentioned above, California has the most expensive gas in the country for the 18th week in a row. Hawaii, Washington, Oregon, Nevada, and Alaska round out the top six. Arizona is 11th. Oregon is fourth most expensive for the fourth week in a row.

All seven states in the West Coast region have small week-over-week changes. California (-4 cents) has the largest week-over-week decline in the nation and the region. Hawaii (-2 cents) also has a weekly decrease. Alaska (+4 cents), Oregon (+4 cents), Washington (+3 cents), Arizona (+2/10ths of a cent), and Nevada (+2/10ths of a cent) have small week-over-week increases.

The refinery utilization rate on the West Coast jumped from 83.3% to 90.0% to for the week ending June 6. This rate has ranged between about 72% to 92% in the last year. The latest national refinery utilization rate rose from 93.4% to 94.3%.

The refinery utilization rate measures how much crude oil refineries are processing as a percentage of their maximum capacity. A low or declining rate can put upward pressure on pump prices, while a high or rising rate can put downward pressure on pump prices.

According to EIA’s latest weekly report, total gas stocks in the region increased from 27.6 million bbl. to 28.6 million bbl. An increase in gasoline stocks can put downward pressure on pump prices, while a decrease in gasoline stocks can put upward pressure on pump prices.

Diesel

For the week, the national average climbs six cents to $3.57 a gallon. The record high is $5.816 set on June 19, 2022. The Oregon average jumps nine cents to $4.24. The record high is $6.47 set on July 3, 2022. A year ago the national average for diesel was $3.77 and the Oregon average was $4.06.

Source: AAA

Karianne