Rising gas prices in Oregon reflect potential long-term problem for US energy resources
PORTLAND, Ore. (CN) — Gas prices spiked in Oregon this week following a 14-week reprieve that began in June. Yet it’s the most recent jump that has drivers shuddering, as the average cost per gallon has increased by 56 cents in a week — the largest price hike in the country.
As of Wednesday, AAA data shows Oregon as having the third highest gas prices in the United States at an average of $5.21 a gallon, although other Western states are reporting expensive gasoline too. In California, the average price per gallon stands at $6.04, while the average gallon costs $5.10 in Washington state and $5.22 in Nevada. The national average is $3.77.
According to AAA Oregon/Idaho public affairs director Marie Dodds, the higher gas prices tie back to oil refinery maintenance in California and Washington state that could last several more days. “This has put a significant crimp in supplies and sent pump prices soaring in this region,” Dodds said in a statement, adding the Olympic pipeline in Washington state is also due for maintenance possibly this week.
But while limited refining capacities are bound to create disruptions every now and then — especially when refineries undergo maintenance simultaneously — one expert said U.S. gas inflation may be a lasting phenomenon due to efforts to reduce the use of hydrocarbons.
“The problem is we're not building replacement capacity,” said Eric Smith, assistant director of the Tulane Energy Institute in New Orleans. “And so, the shortages are scheduled to get worse before they get better.”
As Smith sees it, states like California are trying to replace hydrocarbon with energy sources like wind and solar power, thus limiting the capacity of its oil refineries. But, despite having options to import energy sources from other states or countries, most states cannot overcome their own limitations to replace energy sources fast enough, Smith said.
As an example, Smith cited how the U.S. could import hydroelectric power from eastern Canada, but New Hampshire and Maine denied a bid to place wires across their forests to bring the power to Massachusetts.
“Various parts of the country have different profiles and different problems and different solutions,” Smith said. “But the overarching problem right now is the administration has a tactical problem with making sure everybody's got enough gasoline in their power tanks and enough electricity to get through the winter. And the people that would normally provide those services are starved for capital right now and they're not building those sorts of items. They're running the ones they've got as hard as they can. But that's not enough to answer all of the demands being put on the system in terms of natural gas and refined products.”
As for western states in particular, Smith added: “What's hurting the West Coast right now over this changeover period is the problem with not having enough refining capacity to satisfy the problem. So, they're having to import gasoline and diesel and jet fuel just like they import crude oil, and it's more expensive to do it.”