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Oil is approaching $100/barrel yet gas prices are DROPPING?

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JEDI

JEDI

Lifer
Costco had gas at $3.31/gallon when oil was around $85/barrel.
Now its $3.27/gal when oil is $10+/barrel more.

normally gas prices go up when oil prices go up.

i'm not complaining, but why is it dropping?

This already exists in P&N with pretty much the same info and same people posting prices that are immedialely refuted. One is enough.
admin allisolm
 
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It seems to be only a minor dip in price while still being up about $0.75 since this time last year.

ch.gaschart
 
Modesto California is a town
the chart is from gasbuddy, you can put in your location/town
boomerD lives in california

i paid $3.12 tonight
 
I posted the same thing in the P&N thread. Oil has risen 25% yet gas has been steady or down. The radio stated that it was because gasoline usage was "seasonally" down right now so that even with higher oil, gas was steady. I suspect a big rise during the holidays and a big run up in the spring leading into the summer driving season (assuming oil stays up).
 
JEDI said:
Oil is approaching $100/barrel yet gas prices are DROPPING?

Costco had gas at $3.31/gallon when oil was around $85/barrel.
Now its $3.27/gal when oil is $10+/barrel more.

normally gas prices go up when oil prices go up.

i'm not complaining, but why is it dropping?
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They are not dropping here in the Chicago area.

Prices are well over $4 in the city itself and most suburbs just under $4

Two excuses thrown out there for the higher prices here compared to the rest of the country is paying a premium for storage. The oil tankers are parked everywhere on the Canals overflowing with oil and no where on land to store it since all the tanks on land are full and overflowing.

The other excuse is out of Gas and Diesel here as the local refineries have been exporting more gas and diesel than ever before to other countries.

So why is that our fault and have to pay more for them to make even more profit off our backs here?
 
Don't feel bad. It will go up in a week or so. Probably around thanksgiving. The arabs is not going to take this sitting down while the dollar is down. They want mo money. Better yet they will find an excuse to raise the price even if consumption is low.
 
I did a google search for gasoline oil price disconnect and found this:
"It used to seem crude and gasoline prices moved in sync. Dave Dayvault is chief financial officer of Wichita-based Abercrombie RTD, Inc., an energy exploration company, and has chaired the Kansas Independent Oil and Gas Association. Dayvault says there are five groups at play in affecting gasoline prices. Crude oil producers, refiners, wholesalers, retailers and the government. Right now, he says, if there's anyone to blame it would be refiners."

http://www.kake.com/news/headlines/Oil_Prices_Falling_As_Gas_Prices_Rise_129348453.html
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I remember hearing commentary about there being a huge surplus of oil flowing into Cushing, OK, and that was leading to disconnect in price between WTI and Brent.

So my guess would be that refiners* have now produced a lot of gasoline and that projections for gas demand have gone down, thus gas prices have, relatively speaking, stayed down.

Apparently east coast refiners base price upon Brent, which is much higher than price than WTI. And oil prices may be factoring in concern about an attack on Iran, rather than underlying worldwide growth fundamentals. Someone else said that refiners are switchng over from gasoline to heating oil, so don't know if gas prices will start creeping up again as built up inventories of gasoline are drawn down (?)



*
"With crude oil flows continuing to grow and refineries struggling to process the soaring volumes, refining margins, as well as the value of storage, have soared around the Midwest. In particular, Gasoline and distillate crack spreads have widened to record seasonal levels, BofAML analysis said. On the other hand the refineries processing Brent Crude are not enjoying the same kind of margins. Recent company reports suggest that firms suchas Frontier and Holly that operate refineries in the Midwest have experienced a substantial increase in earnings. Frontier has large heavy crude capabilities at its Cheyenne refinery and direct access to WTI at their El Dorado, Kansas refinery with about 33% of their crude slate coming from WTI. Meanwhile, Holly’s Tulsa, Oklahoma refinery is running over 100 thousand b/d of WTI, representing about 40% of capacity.

http://www.commodityonline.com/news/Oil-glut-in-Cushing-and-pipeline-bottlenecks-37733-3-1.html (this article is from March of this year)
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I also remember Cramer a few months ago mentioning how oil prices were being kept up artifically by oil futures speculators (http://video.cnbc.com/gallery/?video=3000049574), that if oil prices reflected fundamentals, gas should have been around $3.20 or so then (forgot exact figure). David Faber of CNBC has also hinted at price manipulation by speculators, but seemed to fear actually saying what he knew on air. Others have said this is not true, so not sure what to think about this particular angle.
 
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mshan said:
I remember hearing commentary about there being a huge surplus of oil flowing into Cushing (?), and that was leading to disconnect in price between WTI and Brent.

So my guess would be that refiners have now produced a lot of gasoline and that projections for gas demand have gone down, thus gas prices have, relatively speaking, stayed down.

Apparently east coast refiners base price upon Brent, which is much higher than price than WTI. And oil prices may be factoring in concern about an attack on Iran, rather than underlying worldwide growth fundamentals.
Click to expand...

Americans are using less gasoline than ever but being penalized the most for doing so with higher prices. Very similar to electric consumption.


11-9-2011

http://www.bbc.co.uk/news/business-15658275

Oil could hit $150 a barrel soon

"We are in the danger zone for the global economy at current levels," said IEA economist Fatih Birol.

"We have to find and develop two new Middle Easts, that's a tall order," said Mr Birol.


On Tuesday, President Barack Obama agreed to allow further oil and gas drilling in the Gulf of Mexico and Alaska.
 
I believe that article is referring to Brent Crude, not WTI.

Someone on tv said he thought demand destruction would occur at $105 for WTI and I think $120 Brent. (pretty sure about the WTI number, not sure about the Brent one).

How that correlates with $4 gasoline, I don't know.
 
dmcowen674 said:
They are not dropping here in the Chicago area.

Prices are well over $4 in the city itself and most suburbs just under $4

Two excuses thrown out there for the higher prices here compared to the rest of the country is paying a premium for storage. The oil tankers are parked everywhere on the Canals overflowing with oil and no where on land to store it since all the tanks on land are full and overflowing.

The other excuse is out of Gas and Diesel here as the local refineries have been exporting more gas and diesel than ever before to other countries.

So why is that our fault and have to pay more for them to make even more profit off our backs here?
Click to expand...

Like usual, a lying pos - http://www.chicagogasprices.com/

Chicago Avg - $3.68 with one gas station over $4.
 
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