No Significant Drop in Gas Costs With Lower Oil Prices

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US News & World Report - August 10, 2011

Con­sumers often ques­tion why gas prices at the pump are slow to drop when the price of oil declines and rise quick­ly when oil prices are up. Sta­tion own­ers may have paid a much high­er price for their exist­ing gaso­line and slow­ly sell through it, know­ing their next tank load will cost less. Com­pe­ti­tion is a key fac­tor as sta­tions resist drop­ping prices until some­one else does. Sup­ply and demand also impact the pump price with cur­rent gaso­line inven­to­ries low­er than last year.