alt Hacker News> or example, a few weeks ago, physical Dubai oil was nearing $180 per barrel. West Texas crude had a future price of $110 yet the physical price was $140+.
Surely if this were true, gas prices would have risen more than they did.
> or example, a few weeks ago, physical Dubai oil was nearing $180 per barrel. West Texas crude had a future price of $110 yet the physical price was $140+.
Surely if this were true, gas prices would have risen more than they did.
Part of the reason I follow all this is because the whole system is gloriously complex. I have no real reason to follow it and I'm by no means a subject matter expert but I do know enough to see a lot of reporting on all this is just objectively wrong.
There are a lot of components that go into gas prices and it's driven by sevearl supply-demand curves such as the price of crude, the demand for refined petroleum products (also called the "crack spread") and just the demand for gas in general.
But it gets more complicated because even though oil is a global commodity it's not entirely global. There are regional differences where some oil and gas can only go to some areas due to limited pipelines and limited pipeline capacity. So you can still end up with wildly varying regional crude prices.
Plus you have California that really has no pieplines so is largely disconnected from the national oil supply. As such ~75% of California's oil comes from foreign imports. And guess what? ~20% of those come from Iraq and, as such, California is impacted by the closing of the Strait of Hormuz when really no other lower 48 state is.
So we, as a country, both import oil and export oil, which makes a lot of conversations about "energy independence" just wrong.
Anyway, back to gas. Crude is only one component. There are a bunch of additives to create different gas blends used in the US. These are typically divided into winter and summer blends. The additives basically change how much gas (as in, the state of matter, not short for gasoline here) is in your gas tank. Why? Because more gas (state of matter) equals more smog so more additives are added to increase the boiling point in summer.
And on top of that some states, most notably California, have their own blends, which come from Californian refneries, which get their oil from the Gulf (in part).
There are a lot of seemingly unintended consequences in all of this too. So, for example, we're selling a bunch more LNG to Europe because of Ukraine but that's really raising domestic natural gas prices and that's having a huge impact on utility prices. And only going to get worse.
Oh and let's not forget that included in the price of gas are also taxes. Those typically don't scale with price (in the US at least).