Crude Oil Goes Down but Gas Prices Don’t
Last week, crude oil closed down to under $34 per barrel while the national average price for a gallon of gas rose to $1.95. Most people would assume that since crude oil prices are going down that we would see fuel costs fall as well. However, this assumption is ultimately incorrect. Most consumers understand there is a correlation between fuel prices and oil, but what they fail to understand is which oil actually affects fuel prices. The crude oil figures that U.S. consumers see on television and in the paper are driven by the price of West Texas Intermediate (WTI).…