"At 9 a.m. Eastern Time today, the price of oil sits at $110.87 per barrel, using Brent as the benchmark (we'll explain what that means shortly). That's an increase of 44 cents since yesterday morning and roughly $44 more than at this time last year."
"Nobody can predict the future path of oil prices with certainty. A range of factors influence how oil trades, yet supply and demand remain the main drivers. When fears of economic slowdown, conflict, or similar shocks rise, oil prices can move sharply."
"The price you see at the gas pump reflects more than just crude oil. Also built in are the costs of refining, distribution through wholesalers, various taxes, and the margin your neighborhood station charges. Crude oil is still the largest single driver of the final pump price, typically representing over half of each gallon's cost. Spikes in oil prices tend to push gas prices higher in short order. But when oil prices decline, gas prices often ease down gradually, a behavior known as "rockets and feathers.""
"In the event of an emergency, the U.S. maintains a stockpile of crude oil known as the Strategic Petroleum Reserve. Its main goal is to safeguard energy security when disasters strike-think sanctions, severe storm damage, or war. It can also do a lot to ease the pain of sudden price jumps when supply gets disrupted. It's not a permanent fix, as it's more meant to provide immediate support for consumers and ensure critical parts of the economy like key industries, emergency services, public transportation, and so on can keep operating."
Oil prices are currently higher than yesterday and substantially higher than a year ago, with Brent used as the benchmark for crude. Oil prices can rise sharply when fears of economic slowdown, conflict, or other shocks increase, but future price paths cannot be predicted with certainty. Gas pump prices reflect more than crude, including refining, distribution, taxes, and retail margins. Crude oil usually accounts for more than half of a gallon’s cost, so oil spikes often raise gas prices quickly, while oil declines can lower gas prices more gradually, a pattern called “rockets and feathers.” The U.S. Strategic Petroleum Reserve provides emergency support by easing sudden price jumps from supply disruptions, but it is not a permanent solution. Oil and natural gas are linked because changes in oil can shift demand between fuels in some industries.
Read at Fortune
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