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Gas prices falling nationwide
CHEYENNE Gas prices have been dropping sharply across the United States, but that drop hasn’t been happening as quickly in Wyoming and the rest of the West. average of $2.29 for a gallon of regular unleaded. The states paying more than Wyoming are also located in the West, plus Alaska and Hawaii.
In fact, every state west of the Dakotas has gas prices ranging from 10 to 75 cents above the national average. The discrepancy is largest in California and Nevada, where prices currently top $3 per gallon.
“Normally, Colorado, Wyoming and the surrounding states are a dime or more lower than the national average,” said Wave Dreher, a spokeswoman for AAA Colorado. “It’s very unusual for us to be higher.”
Yet that’s the case right now, even as Gulf Coast states enjoy the cheapest gas in the country, with Alabama, Mississippi and South Carolina all paying less than $1.95 per gallon.
So what’s the reason for the wide disparity in gas prices from one region to another? With so many factors at play in the oil and gas market, it can be a difficult question to answer definitively. But one big factor affecting current prices appears to be refineries where they are and what’s happening with them.
The Gulf Coast region has the biggest and most diverse concentration of oil refineries and pipelines.
“There’s a lot of key infrastructure and interconnectedness in the Gulf,” DeHaan said. “You’ve also got the lowest gasoline taxes in the country there, and that’s the motto in every state that’s got cheap gas. So it’s cheap gas taxes and proximity to the http://www.cheapjerseys11.com/ bulk of the nation’s refining capacity.”
By comparison, he said, refineries tend to be more spread out in the West, and there have been a number of maintenance issues impacting supply to the western states this year.
One of the largest was the explosion of an Exxon Mobil refinery in Torrance, California, back in February. Even now, seven months after the explosion, that refinery has yet to return to full capacity, helping to drive California’s gas prices to the second highest in the nation behind Alaska.
But while the Torrance refinery’s issues are more localized to the West Coast, DeHaan said another refinery much closer to home also has been causing a ripple effect in gas prices across the West.
Specifically, he said the Sinclair oil refinery just east of Rawlins shut down in mid June for a “major turnaround,” which lasted up to this month. Calls to the refinery for additional details were not returned Monday, but according to his sources, DeHaan said the refinery was undergoing some sort of modernization, the biggest such project in the refinery’s history.
“It may have been an upgrade so that the plant could run a more diverse set of crude oils, which has been a common trend refineries have been taking nationwide,” DeHaan said. “I believe that to be the contributor to the uptick in price.”
He said that turnaround was supposed to wrap up by the first half of September. But in the meantime, it meant that about 90,000 barrels of oil per day weren’t being refined, which equates to almost 4 million gallons of gasoline.
“You talk about one refinery that processes that much oil a day being down nearly the entire summer, and that impacts the entire West,” DeHaan said. “You have pipelines that run from Sinclair to Salt Lake City, and pipelines there tie into Spokane and eastern Washington.”
Denton Cinquegrana, chief oil analyst for the Oil Price Information Service, agreed that the Sinclair refinery’s downtime could have had a significant impact on gas cheap jerseys prices in the West, especially when combined with other local supply issues like the one in California, as well as other “minor hiccups” at refineries in places like Oklahoma and Indiana.
“There’s not one single thing (impacting gasoline prices),” Cinquegrana said. “But they had a major turnaround at the refinery in Sinclair, and that one being out for a good portion of the summer thinned out supply a bit.”
Cinquegrana noted that gas prices in the West particularly in more rural states like Montana, Idaho and Wyoming also tend to lag behind the national average as it rises and falls. This can be advantageous in times when the gas price spikes, he said, but it also means those states have to wait longer when the price drops.
For this reason, he said, local motorists should expect gas prices to catch up to the cheaper prices in the South in the coming weeks, especially as retailers begin to make the switch from the more expensive “summer blend” of gasoline to the cheaper “winter blend.”
“I do think we’re going to see a repeat of what we saw last fall and winter, where prices got to as cheap as they had been in several years,” Cinquegrana said. “There’s certainly some room to the downside here. We’re going to start to see that materialize as the formulation of the gasoline changes.”.
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