I thought the price of oil determines gas prices?

Is there some equation, besides supply and demand, that I'm missing? That's the general, blanket comment I always hear, "well on today's markets the price of oil is $67 a barrel" then I'll hear, "price of oil today is $60 a barrel" yet gas prices increase. I just feel like it's something other than oil prices and supply and demand.

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windinhishair · 61-69, M

There is always a lag time between oil production and refining into gasoline and other products. But gas retailers always jack up prices quickly following oil price increases, and only gradually and begrudgingly reduce them when the price comes down, so they benefit on both increases and decreases in the oil price.

twiigss · M

@windinhishair Yep. I've noticed that too.

windinhishair · 61-69, M

@twiigss There was a study conducted a few years back that showed exactly how much they profited by doing so. It was quite amazing.