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Cool. So, to simplify the curves, you divide the crude oil price by 40 and add a quarter to get an approximation of price at the pump.
Divide crude by 42 (gallons in a barrel) to get approximate refiner cost of gallon.
Add 15 cents to get wholesale price.
Add another 65-90 cents to get average national retail. Although this amount has gone as high as $1.45 recently, It averages about 75 cents.
Note to JR: you might want to change the color of the data points after the July price peak, as they will now trend backwards through the previous data points. Could be hard to distinguish.
Just a suggestion.
Perhaps we ought to look at how the correlations change over time. Color code the points from dark purple [the oldest] to bright red [the newest] and see if over time the correlations remain consistent or change. And are we seeing an extreme price sensitivity above $4 per gallon? I’d rather look at a set of curves relating price to demand. What really drives retail price is the need to keep production levels and capacities in balance.
I never did understand why lack of refining capacity would increase crude prices. It should go DOWN, not up. And I would like to see this graph for 2009 as well.
crude oil barrel price…
[…]Crude Oil – Gasoline Correlation « Crude Oil[…]…
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