[bolobaby]

When oil was $140, the price of gas was just around $4 in my neck of the woods. NOT including the recent Ike-spike, when oil is now $100, gas was $3.45 (and only at one place - the two other gas stations at the same intersection were priced at $3.59 and $3.65).

Hmmm. Let’s do some math.

100/140 = 71%
3.45/4.00 = 86%

Well, isn’t that peculiar?

Now gas stations are purposefully jacking the price up in the wake of Ike when there is still plenty of room to go down from the barrel price drop.

[DuncanWaring]

Keep in mind that one component of the price of a gallon of gasoline (probably at least 50 cents, depending on where you live) is state and federal tax, and those don’t go down with the decreasing cost of crude.

If the cost of producing and distributing gasoline went to “zero”, you’d still be paying that fifty-cents-a-gallon tax.

[GregoryFul]

Pretty simplistic analysis based on silly assumptions. Refining operations have been suffering for most of the year - take a look at Valero (VLO: $70+ to $30-) or Tesoro (TSO: $50+ to $15-), with recent IKE related 20% pops. They should be making some profit from supplying us with gasoline, heating oil, diesel, etc., but have been loosing money (EPS going negative) because of the high input cost of crude, and the declining consumption of their product.

Most certainly, a hurricane that tears up a region where 25% of US refining capacity resides will cause refined product prices to go up, duh! And will also cause crude prices to go down - as demand is reduced. Economics 101, not the conjured wizard of OZ, are affecting market prices.