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Understanding Today’s Crude Oil and Product Markets

Understanding Today’s Crude Oil and Product Markets. Rayola Dougher API Senior Economic Advisor, dougherr@api.org. Crude oil and petroleum products are global commodities. Prices are determined by supply and demand factors on a worldwide basis. Refiner Acquisition Price of Crude Oil.

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Understanding Today’s Crude Oil and Product Markets

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  1. Understanding Today’s Crude Oil and Product Markets Rayola Dougher API Senior Economic Advisor, dougherr@api.org

  2. Crude oil and petroleum products are global commodities Prices are determined by supply and demand factors on a worldwide basis.

  3. Refiner Acquisition Price of Crude Oil Dollars per Gallon Source: EIA

  4. Changes in Gasoline Prices Mirror Changes in Crude Oil Prices Dollars per Gallon Source: EIA

  5. Relationship between Retail Gasoline, WTI and Brendt Crude Oil Prices Source: EIA

  6. Oil Prices Relate to Many Uncertain Factors Source: EIA

  7. Oil Price Growth Mirrors World GDP Growth Changes in the price of oil have closely tracked changes in the world’s gross domestic product growth. Source: Dallas Fed

  8. Relationship between OPEC’s Spare Capacity and Oil Prices Reduced OPEC excess capacity helped tighten the oil market. In mid-2008 when oil prices reached record highs, OPEC excess capacity was down to 1 million barrels per day. Source: Dallas Fed

  9. Trends in WTI Prices Mirror Trends in Commodities Without Futures Markets Prices for Illinois Basin coal, tallow and cobalt increased as fast as oil, if not faster, in 2008 and fell just as quickly when the economy crumbled. Source: Dallas Fed

  10. What Consumers are Paying for at the Gasoline Pump Average of gasoline components for January – November, 2011 as reported by EIA

  11. U.S. Gasoline Requirements

  12. Components of Annual Average Gasoline Prices Adjusted for Inflation 2012 Dollars per Gallon Source: EIA

  13. Components of Monthly Gasoline Prices Adjusted for Inflation 2012 Dollars per Gallon Source: EIA

  14. Monthly Refiner Margins Adjusted for Inflation 2012 Dollars per Gallon Source: EIA

  15. Components of Gasoline Prices in 2011 Dollars per Gallon Source: EIA

  16. Refiner Margins in 2011 Cents per Gallon Source: EIA

  17. Earnings Cents of net income per dollar of sales Source: Based on company fourth quarter 2011 financial reports.

  18. Western States’ Gasoline Prices Cents per Gallon Source: AAA Fuel Gauge report

  19. Components of Gasoline Prices on January 26, 2012 Source: AAA Fuel Gauge report, NYMEX WTI crude, API gasoline tax estimates

  20. Thank You For more information visit www.api.org www.energytomorrow.org www.energycitizens.org

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