11-22-2014, 05:14 AM
The barrel price of oil does not reflect the refinery costs. The refinery costs are still y and the barrel price is a floating x and then we've distribution costs at z. Gas price is x+y+z = ? When oil prices fall by half and the gas price at the pump only falls a fraction of half then the refinery and distribution cost exceed the barrel value.
For every refinery that's restricted from being built and for every pipeline that is stopped from being formed to distribute the prices of these factors then rises.
At this time the barrel price of fuel could be 1 cent a barrel or free and the price of gas at the pump would only drop to around 60% the current price.
For every refinery that's restricted from being built and for every pipeline that is stopped from being formed to distribute the prices of these factors then rises.
At this time the barrel price of fuel could be 1 cent a barrel or free and the price of gas at the pump would only drop to around 60% the current price.