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CSP, April 24, 2017:
Opinion: As Prices Dip, Who's Passing On the Savings?
Crude-oil costs have dropped, but gasoline prices are on the rise

CSP, April 10, 2017:
Opinion: Pump-Price Pressure Increasing
Crude and gasoline both up a dime

CSP, March 26, 2017:
Opinion: Stability for Consumers, but Not for Retailers
Pump price slips one penny with crude: Lundberg

CSP, March 12, 2017
Opinion: Pump Price Up, but Not for Long
Crude oil and gasoline supply suggest declines ahead: Lundberg

CSP, February 27, 2017:
Opinion: Retailers Take a Beating on Margins
As pump prices edge up, retail profit still narrowing

CSP, February 13, 2017:
Opinion: Winter Cold Hits Retail Fuel Margins
As wholesale prices climb, retail margin gets slashed

CSP, April 24, 2017:
Opinion: As Prices Dip, Who's Passing On the Savings?
Crude-oil costs have dropped, but gasoline prices are on the rise

CAMARILLO, Calif. -- The U.S. average retail price of regular-grade gasoline rose 2.88 cents per gallon (CPG) over the past two weeks to $2.4615. The rate of increase has slowed by more than two-thirds vs. the prior two-week period, according to the most recent Lundberg Survey of approximately 2,500 U.S. gas stations.

Meanwhile, the prices of light-grade crude oil slipped impressively. Retail prices rose instead of falling because both refiners and retailers had gasoline margin improvements. Refiners took that oil price cut and passed some, but not all, into wholesale gasoline. Retailers took that wholesale gasoline price cut and increased prices at retail, on average.

Refiner margin on gasoline already includes most of the cost increases from the required shift to summer blends as well as most of the cost jumps from recently higher Renewable Identification Number (RIN) prices that some of them must pay. Retail margin on gasoline also includes most of these costs.

In the short term, if oil prices don't retreat strongly and quickly, any further retail price increases are likely to slow further, or maybe even cease.

Crude-oil prices remain king. Oil markets care about every single barrel of world supply and demand, and about all viewpoints. Every day, they vote on opposing influences. For more than a year, the resulting vote has corralled oil prices within a range of about $40 to the low $50s per barrel, both before and after the Organization of the Petroleum Exporting Countries’ (OPEC) November 2016 supply-cut agreement.

That relative crude-oil price stability is a big reason for the rather low price volatility in the U.S. gasoline market vs. the historical norm. So far, the spring 2017 gasoline price rally is rather muted: The average retail price is up about 8 cents and the weighted wholesale price is up about half that amount from the beginning of the year. OPEC will review its supply-reduction agreement five weeks from now. And the oil market will review that review, giving input to U.S. prices on the street.

Camarillo, Calif.-based Lundberg Survey Inc. is an independent market research company specializing in the U.S. petroleum marketing and related industries. Click here for previous Lundberg Survey reports in CSP Daily News.

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