Not sure if you are like us, but we’ve long wondered what makes the price of gasoline at the pump change and sometimes so dramatically.
Maybe this topic is more top of mind as with a larger vehicle it’s easy to get to the credit card max for the pump max of $100 this day and age!
Of course spot gas prices are a contributing factor (just over half), but as our friends here at Visual Capitalist point out along with the EIA, there are more factors than just the spot price of gasoline for what we pay at the pump.
Interesting but not surprising location of the Top 10 Largest Refineries… bottom right of chart!
The following from the actual article:
The Four Main Factors
According to the EIA, there are four main factors that influence the price of gas:
- Crude oil prices (54%)
- Refining costs (14%)
- Taxes (16%)
- Distribution, and marketing costs (16%)
More than half the cost of filling your tank is influenced by the price of crude oil. Meanwhile, the rest of the price at the pump is split fairly equally between refining costs, marketing and distribution, and taxes.
Have a Great “Now you know how the pumps price of Gasoline occurs“ day!
John A. Kvale CFA, CFP
Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
jkfinancialinc
street-cents
$treet-¢ents 
Oil … Possibly the Story of the year?
Oil, or the price movement of oil, is turning into an interesting topic. After bottoming at $26/barrel in February of this year, it moved briefly above $50/barrel.
How about this rollercoaster ride ? Well maybe parachute jump would be more accurate…
Now the bounce back to over $50! Wow!
What about this move down in Rig count? Capitalism at work!
What we suspected throughout this cycle was the trickle down effect from the Energy sector and especially the peripheral feeder vendors was greater than many thought.
The terrific success of US drillers (see above massive increase in rig count) may have created a greater positive than many understood during the boom time. When the bottom dropped out of prices … well the negative may have been greater as well.
Could be a much needed tailwind??? … time will tell !
Have a Great Day!
John A. Kvale CFA, CFP
Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
www.street-cents.com
-96.808138
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Posted in Earnings, Forecast, Investing/Financial Planning, Market Comments
Tagged Baker Huges Rig Count, Crude, Oil, WTI