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UNDERSTANDING TODAY’S CRUDE OIL AND PRODUCT MARKETSRayola DougherAPI Senior Economic Advisor, [email protected]
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Prices are determined by supply and demand factors on a worldwide basis.
Crude oil and petroleum products are global commodities
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Refiner Acquisition Price of Crude Oil
Source: EIA
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Source: EIA
Changes in Gasoline Prices Mirror Changes in Crude Oil Prices
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Relationship between Retail Gasoline, WTI and Brendt Crude Oil Prices
Source: EIA
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Oil Prices Relate to Many Uncertain Factors
Source: EIA
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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
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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
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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
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What Consumers are Paying for at the Gasoline Pump
Average of gasoline components for January – November, 2011 as reported by EIA
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U.S. Gasoline Requirements
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Components of Annual Average Gasoline Prices Adjusted for Inflation
Source: EIA
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Components of Monthly Gasoline Prices Adjusted for Inflation
Source: EIA
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Monthly Refiner Margins Adjusted for Inflation
Source: EIA
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Components of Gasoline Prices in 2011
Source: EIA
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Refiner Margins in 2011
Source: EIA
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Earnings
Source: Based on company fourth quarter 2011 financial reports.
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Western States’ Gasoline Prices
Source: AAA Fuel Gauge report
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Components of Gasoline Prices on January 26, 2012
Source: AAA Fuel Gauge report, NYMEX WTI crude, API gasoline tax estimates
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