What is the relationship between oil and gasoline?
What is the relationship between oil and gasoline? Crude oil—the main component of gasoline—makes up nearly 70 percent of the pump price of regular gasoline. 2 Therefore, it is not surprising that the per gallon price of retail gasoline follows a similar pattern to the price of crude oil. How does supply and demand affect oil prices? Every movement on the production and consumption side of oil is reflected in the price. The law of supply and demand states that if supply goes up then prices will go down. If demand goes up then prices will go up. What factors...