The Iron Law of Gas Prices

The Iron Law of Gas Prices

Price of Gas  =  (World Price of Oil)  +  $1.00/gal

The price of gasoline (in 2012 dollars) has been [#$1.00 more] per gallon than the price of oil for the last 25 years (see graph below). There were some small deviations, but nothing systematic. There's nothing we can do about this unless we change the [#world oil price] — or we subsidize gasoline like Iran and Venezuela.

The Iron Law of Gas Prices (click to enlarge)
gas price oil prices graph

 


PopNotes Used Above

[=gas price widget]Enter a 2-letter State Abbreviation at the bottom of the widget to find your state's prices. Many variations are available for your website. 
[=$1.00 more] The $1.00 value is just a lucky coincidence. It covers the cost of refining, delivery and taxes. Three or four years from now, after about 10% more inflation, this will be $1.10 or so.
[=world oil price] The US price or the World price of oil?

This graph uses the world price of oil which is best represented by the Brent (North Sea) price of Oil.

[=bets on the future]All about Speculation:  If your skeptical of this claim, good for you. But then you should check this out. It's the clearest explanation you'll find anywhere.