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To: bananaman22

The problem with the virus is it is keeping people from driving, so the gas station tanks are full of expensive gas from two or three weeks ago. The pump prices can’t drop until the new cheap gas is delivered and pulling down the local prices.


40 posted on 03/30/2020 10:51:27 AM PDT by Born to Conserve
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To: Born to Conserve
that's why futures markets exist ... so entities holding the actual product can hedge against prices moves while they're holding.

it's no coincidence that 1 futures contract for gasoline if for 44,000 gallons, the same as a tractor trailer holds.

if they hedged they could move the price at the pump immediately to match the spot price.

41 posted on 03/30/2020 10:58:11 AM PDT by bankwalker (Immigration without assimilation is an invasion.)
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