Quote:
Originally Posted by Harry Lime
The problem with increased rates goes farther back than July 2017. I'm not educated enough on the supply chain to know the direct connection between Alberta Synthetic Crude and what ends up in local pumps.
I was under the impression West Texas Crude was used as the benchmark. If you take the current value and go back to the last time the oil was at that value, then take the price of gas at that time and increase by inflation you should get the what the current price of gas at the pumps should be, roughly. Hit several such points over the last 15 years to find a trend.
That it is much higher indicates that something else is going on.
(other people have done the math, I'm not going to)
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Then don't make statements such as this.
Quote:
Originally Posted by Harry Lime
By this point, the oil companies have pretty much detached gas prices from having any association to the value of oil.
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The supply chain is the fundamental foundation of gasoline prices. Crude costs only make up around 40%-50% of the supply cost for a litre of gasoline.
Regarding WTI, yes it certainly is a benchmark for WCS. But the differential swings all the time based on many factors...transportation bottlenecks (e.g. pipeline bottlenecks), regional supply/demand conditions (e.g. maintenance on local refineries took longer than expected this year which cuts supply which spike price), US:CAD exchange rate.
And if you want to get real technical you could say its all benchmarked off of Brent.
So ya...more complicated than gouging. Don't like it? Don't buy it. That or complain to the Venezuelans and the Iranians (via Trump).