Why gas is so expensive, when oil isn't [View All]

:argh:




NEW YORK (CNNMoney) -- Gasoline prices have been rising for months and are within striking distance of their 2008 all-time high of $4.11 a gallon. But while oil prices are above $100 a barrel, they're still 24% below their 2008 all-time high. So why is gasoline so expensive, when oil is so far off its record price?

The answer is that the price of oil Americans see every day has little to do with the price of gasoline at the pump.Those prices are for a particular type of oil -- West Texas Intermediate -- that's stored in Cushing, Okla.

Thanks to increasing supplies from the Rocky Mountain states and Canada's oil sands, plus a lack of pipelines to move that oil out, there's currently a big glut of oil in Cushing. That's pushing the price of West Texas crude down.

Prices for most other types of oil, which make up the vast majority of oil that refiners use in U.S. gasoline, are much higher than West Texas Intermediate. London's Brent crude, for example, was closer to $124 a barrel on Wednesday.




http://money.cnn.com/2011/04/21/markets/oil_gas_prices/index.htm?hpt=T1