[mnehring]

Because the wholesale cost of crude is only a tiny fraction of the entire expense that goes into gasoline production. With a $.05 to $.10 profit on each gallon, there is very little downward wiggle room if that one piece of the expense pie drops.

[icwhatudo]

Your comment:

“the wholesale cost of crude is only a tiny fraction of the entire expense that goes into gasoline production.”

vs the articles claim:

“Crude oil accounts for about three-quarters of the cost of gasoline.”

What am I missing?

[rightinthemiddle]

“...crude is only a tiny fraction...”

________

What’s a tiny fraction?

[RobRoy]

Just my opinion, but I think “tiny fraction” overstates it. Is is a large part, but not the whole thing.

[Bonaparte]

"Because the wholesale cost of crude is only a tiny fraction of the entire expense that goes into gasoline production."
____________________________________________

On the contrary --

According to the Energy Information Administration, which provides official energy statistics from the U.S. government, approximately 19% of the cost of gas is attributed to federal and state taxes. The remaining cost of a gallon of gas is accounted for by gasoline distribution and marketing, which accounts for 9% of the cost filling your tank, refining the oil, which accounts for 19%, and cost of crude oil, which accounts for 53% (using 2005 data).

These figures are averages, of course, and will vary somewhat from state to state.

[Star Traveler]

You said — “Because the wholesale cost of crude is only a tiny fraction of the entire expense that goes into gasoline production.”

The newspaper article said — “Crude oil accounts for about three-quarters of the cost of gasoline.”

And I posted a chart showing how much gasoline comes out of a barrel of crude oil. Also, note that the price percentage doesn’t necessarily have to match the percentage per the quantity, either... (so there can be a discrepancy there...).