How do gas prices get the way they are?

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Tornado

Tornado

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From the "Oil hits $100 per barrel" thread:
Toronado
You misunderstand. All those things should add money, but if each barrel is 19.5 gallons then gas is more than a $1.60 cheaper at the pump then by the barrel.
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Toronado
So how does it lose $1.60 from its wholesale-style purchase to the pump? I'm confused.
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I think, and correct me if I'm wrong, that it has to do with the government releasing oil from it's reserves to somewhat keep prices in check.
 
Gas prices-just another way for the government to squeeze money out of us.
 
Gasoline is made from oil, but it is not oil. It requires a great deal of processing, refining, storage, and transportation. A lot of people mark it up along the way - but oil prices are directly related to gas prices.

If you're asking why they're so high, it's based on the commodities exchange. There is some speculation about future prices that feeds into price changes along with a basic supply-demand relationship. When reporters quote the price of oil per barrel, they're quoting the going rate on the commodities exchange - which is set largely by traders (not the big bad oil companies).
 
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