Comment by andrew_lettuce 6 days ago
How can you possibly say that crude is half of the pump price? The economics are incredibly complex and murky, and the price of gas doesn't move with any sort of linear relation to crude except in very long timeframes. Regional refining capacity is way more important.
> How can you possibly say that crude is half of the pump price?
I googled for a couple sources on the breakdown of the price of gasoline, and they seemed to be in agreement that the raw cost of crude is somewhere around half. (And broke refining out separately.)
I'm sure it's not perfect, but it seems fairly reasonable. (And it can be off by quite a lot and still not make a huge difference to the cost-per-km of driving.)
> How can you possibly say that crude is half of the pump price?
Look at gas prices in your area. Look at the price of crude. Divide.
How could you possibly not be able to estimate the fraction?
And yeah ideally you use an average number over some months and you sample the crude earlier than the gas but those are minor tweaks.
A) Just calculating the percentage doesn't assume that.
B) They shouldn't correlate by a particularly large amount in a competitive environment. For an approximation as rough as "half" and assuming no other changes it's not a big deal.
The price of gas isn't immediately and directly impacted by the price of crude because of futures contracts. This naturally means gas prices will move to match the price of crude over time. It's a feature of the current system, not an indication that the price of gas isn't heavily reliant on gas. Nobody is making gas with spot prices.