Oil is $75/bl. Yet I've seen gas back down to $2.89/gl or less. Why?

[Deja Q]

In my area.

Last time it was $2.89, oil was $70/bl, after Katrina.

[AndyA]

1. Well, now you've done it! They've made a boo boo and you've pointed

it out to them! Just you wait - by tomorrow the price of gas will be skyrocketing. The station attendants are likely getting word to change the signs even as I type this...

[madeline_con]

2. They don't have a major storm to use as an excuse.

And people are sick of their gloating about record profits when it's so "hard" to supply the American public with gas to go to WalMart.

[skylarmae]

3. today it went to $76 and electronic to 78

kiss all the $2.89 goodbye ....

[benburch]

4. Hysteresis in the market.

No market is truly the ideal "efficient" market.

And people are trying to drive less. This lowers demand.

[Tempest]

7. People are not driving less

Surveys show people are not driving less, they are cutting back on purchases of other goods and services.

That's why the economy is slowing down despite increasing gasoline sales.

[benburch]

9. Well, I know *I* am.

And my next door neighbors are too.

Of course, some people have commutes that they cannot avoid.

[Tempest]

10. I'm driving less as well

Not by much though. I don't drive much as it is.

People still have to commute and it appears from the surveys people are not holding off on traveling during this summer.

Despite the high cost of fuel, and the recent increase in fares to off-set the additional costs, airlines are seeing an increase in travelers as well.

[Clark2008]

14. I think we can agree that people are cutting back on something -

whether it's driving or other goods and services - either way that effects gasoline prices. If people aren't purchasing as much Made-in-China crap from Walmart, then they're not shipping as much - or, more accurately, trucking in as much - which means that trucks aren't using as much gasoline, thus, effecting the demand for gasoline.

It's all tied in together.

[Tempest]

22. People are still buying the same amount of gas

But they are spending less at the counter on other items where they buy their gas.

More than half of a gas station's profits come from the sale of drinks, snacks and other items. According to a report I read yesterday, gas stations are reporting a sharp drop in the sales of those items.

[pooja]

11. There's only so much you can cut back on.. You have to

get to work and you have to eat. But now the trips are combined.. look at how many people are grocery shopping in suits and uniforms. Right now, its not enough of an impact on people's purses. Unfortunately, before anything really gets done, it will have to effect more middle class people. And the poor will go without. I am only grateful that I work close enough to work that 15.00 will get the week done. But my husband has so much further to drive.. when it takes a full day's pay to get to work for the week, it makes the other 4 stretched thin.

[Nabia2004]

18. Interesting, most people I know are driving less

Yet, these surveys keep telling us different. Perhaps its too soon to tell.

[Tempest]

23. It's the middle of summer and we've had two major holidays

It's not too soon to tell.

Remember, there's a big disconnect between what people say they are doing and what they're actually doing. People may claim to be driving less, but are they really?

[VTMechEngr]

5. Lucky Bastard!

Its been $3.19 here in rural Connecticut.

[Tempest]

8. You're a lucky bastard

It's $3.45 in some parts of California.

[HockeyMom]

16. I honestly cannot remember when it was UNDER $3.00

6 months ago? Maybe? Can $4/gallon be far off for some of us?

Today it was $3.19 to $3.25 where I live.

[Tempest]

24. It was under $3 last week in California's central valley

It just climbed back over $3 here.

[Tempest]

6. Supplies

If refineries are still producing gasoline stock from lower priced oil (two week ago and last week's prices), the price at the pump won't reflect the current price.

Wait until the stocks are depleted, the price of gas is going to shoot up. It already has in California.

[Joe for Clark]

13. Its never gone down here (in LA).

I don't remember paying less than 3.00, in a long time. It was 3.39 this am, and sure to be up tomorrow.

[Tempest]

21. Perhaps you should find another gas station

Gasoline prices are declining in L.A.

http://www.losangelesgasprices.com/retail_price_chart.aspx

[Joe for Clark]

17. You know it doesn't really work that way, right??

It is like - if it goes up you are immediatly screwed - it it goes up later - they screw you now and then justify it later.

It goes up fast on BS, and goes down slow on reality.

You kind of have to admire the oil companies for the way they do it, really.

Joe

[Tempest]

19. It does work that way, and has for decades

There's plenty of documentation available to demonstrate it.

I talked to a friend in L.A. last night and he confirmed prices did drop there and started climbing again. They did the exact same thing here in Bakersfield.

Gas prices in L.A. have indeed dropped:
http://www.losangelesgasprices.com/retail_price_chart.aspx

[Liberal In Texas]

12. Noticed that too. Yesterday 2.95, today 2.89. But there is a new sticker

on the pump. "May contain ethanol."

Are they going to start putting ethanol in the gas to make it cheaper? Whether we want it or not?

[Bigmack]

15. Why gas down?....

Just to lube us up for the next go-round.

We've already got a size 19 poopchute.... brace yourself!

[warrens]

20. Takes time for the new price ($78 this morning) to work its way through nt

[MallRat]

25. There's a lag time between crude prices & price at the pump.

Give it a few days... you'll see it.

I remember the day when reports started to come in about refineries being shut down by Katrina... I gassed up at an oh-so-low $2.90 a gallon. The next day, the same station was up over $3.25.

-MR

[deaniac21]

26. A little primer...

http://www.eia.doe.gov/pub/oil_gas/petroleum/analysis_publications/primer_on_gasoline_prices/html/petbro.html