A barrel purchased today will not be at the pump tommorrow, the stuff at the pump was bought for over $100. Oil also was under $80 for a very short time, unlikely that every oil company bought next month’s supply during that ten minutes. They average what they have to pay. Will is get passed on asap? No. Eventually it will go down, if these oil prices hold for a month and they stay around $80 every day for the next month, we will see it fall below $3 at the pump, maybe $2.75 at Costco.
Look at the average price for a month, not just closing price but the average it gets to in a day and a month. Even today, it was $79 for a little while and $83 for a while, so toady’s average was really $81, other days it may settle at $83 but spent time at $88, so you can’t use the low water mark in calculating what they got it for since we as a country buy oil every second of every day.
