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Old 01-15-2016, 07:29 AM   #1
spinelll
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Default Confused about motor oil prices

Please explain this equation to me:

  • Crude oil price rises ($100+/barrel) = gasoline price rises ($4.00+/gal) = motor oil price rises ($4.24/qt). Understood.

  • Crude oil price falls ($35/barrel) = gasoline price falls ($1.87/gal) = motor oil price remains the same ($4.24/qt). Not understood.

How is it that Iím paying $1.87 for a gallon of gas and $17.00 ($4.24/qt) for a gallon oil?
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Old 01-15-2016, 07:46 AM   #2
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Default Re: Confused about motor oil prices

I just paid 12.00 for 5 quarts at walmart ,Im guessing the oil that I bought was made months and months ago and due to the way it's sold it's not going to be be as effected by market as gas is .We might hear from bulk sellers (oil change places) what they pay for large drums of oil.
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Old 01-15-2016, 07:48 AM   #3
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Default Re: Confused about motor oil prices

Different refining processes and not as subject to price competition and seasonal demand as gasoline. IMO, not based on any data.
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Old 01-15-2016, 08:06 AM   #4
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Default Re: Confused about motor oil prices

Maybe price reduction inertia? Might as well hang on to any margin you can until forced down by the competition.
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Old 01-15-2016, 08:14 AM   #5
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Default Re: Confused about motor oil prices

Simple answer! Greedy oil companies that care only about one thing.....profit! It is called price gouging. Get used to it my friend! Wayne
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Old 01-15-2016, 08:43 AM   #6
BRENT in 10-uh-C
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Default Re: Confused about motor oil prices

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Originally Posted by mhsprecher View Post
Different refining processes and not as subject to price competition and seasonal demand as gasoline. IMO, not based on any data.

Interesting thought ....and another thought or two to add, --gasoline does not "store well" as evidenced by the short period it takes to start running poorly. Thus, it probably does not make sense to try and store it waiting on the price to rise again. Also, oil is not just used for gasoline, diesel, and oil. It also is used in the manufacture of other things such as plastics. The demand for those things are seemingly higher since gas prices are down, which probably means the oil is being diverted to another use.
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Old 01-15-2016, 09:08 AM   #7
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Default Re: Confused about motor oil prices

Even with the dramatic decrease in a barrel of oil I am still paying over $4.40 dollars a gallon for gas ( $1.10 a liter ). And I live in one of the cities with Canada's biggest refineries ( Imperial Oil, Shell and Sunoco ). Wayne
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Old 01-15-2016, 12:35 PM   #8
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Default Re: Confused about motor oil prices

They also make a ton of it at one time. When gas started going up and up and almost hit$5.00 a gallon, oil was still cheap. It took a long time for the price of oil to start going up.
I bought 30 cases of it when it was .99 cents a quart and hopefully it will last until oil comes down again..
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Old 01-15-2016, 12:53 PM   #9
Marshall V. Daut
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Default Have you ever noticed....?

...that when an oil price hike is announced, almost immediately the gas stations raise their prices? But when a reduction in crude oil is announced, the prices at the pump don't drop for days or even weeks, if at all? I understand that the gasoline in the ground was purchased at a rate that may have been higher weeks before, so I can also understand why an immediate drop cannot always be expected. But why, when an increase is announced on crude oil that hasn't even been refined into pump gasoline yet, do the station prices go up that very day? We all know why - GREED. I take careful note of which stations do this and avoid them in the future whenever possible. If we all did that, the stations might behave themselves and raise/lower their prices according to the cost of the gasoline in the ground that they are selling THAT DAY, not in three weeks after the newly-refined gasoline has been delivered.
Or am I expecting too much?
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Old 01-15-2016, 12:55 PM   #10
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Default Re: Confused about motor oil prices

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Originally Posted by Dodge View Post
They also make a ton of it at one time. When gas started going up and up and almost hit$5.00 a gallon, oil was still cheap. It took a long time for the price of oil to start going up.
I bought 30 cases of it when it was .99 cents a quart and hopefully it will last until oil comes down again..
30 cases of 24 is 720 quarts or 12 to a case is 360 quarts ! How many personal cars or is it for a business? Wayne
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Old 01-15-2016, 01:15 PM   #11
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Default Re: Confused about motor oil prices

Quote:
Originally Posted by spinelll View Post
Please explain this equation to me:

  • Crude oil price rises ($100+/barrel) = gasoline price rises ($4.00+/gal) = motor oil price rises ($4.24/qt). Understood.

  • Crude oil price falls ($35/barrel) = gasoline price falls ($1.87/gal) = motor oil price remains the same ($4.24/qt). Not understood.

How is it that Iím paying $1.87 for a gallon of gas and $17.00 ($4.24/qt) for a gallon oil?
1.87 a gal..wow, how are property prices there !
Complicated subject, for sure. Greed may play a part, but gov control plays a much bigger part ! At least, out here on left coast, TAXES between your price and our 2.87+ gal...is a pure taking/wastefulness of our money ! Roads / highways were to be the best (reason for taxing), but are among worst. Ever listen to 'experts', on this subject. No two agree and they cannot be understood anyway, as they often double as advocates and lobbyist. Complicated, indeed.
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Old 01-15-2016, 01:20 PM   #12
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Default Re: Confused about motor oil prices

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1.87 a gal..wow, how are property prices there !
Complicated subject, for sure. Greed may play a part, but gov control plays a much bigger part ! At least, out here on left coast, TAXES between your price and our 2.87+ gal...is a pure taking/wastefulness of our money ! Roads / highways were to be the best (reason for taxing), but are among worst. Ever listen to 'experts', on this subject. No two agree and they cannot be understood anyway, as they often double as advocates and lobbyist. Complicated, indeed.
Property taxes in jersey are outrageous double what PA is .. They need cheaper gas there
A house on a 1/4 acre is about 14k in property tax over there
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Old 01-15-2016, 01:23 PM   #13
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Default Re: Confused about motor oil prices

I just bought a qt of 5-20 oil from walmart for 2.44 a qt, it was super tech oil, their brand
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Old 01-15-2016, 01:23 PM   #14
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Default Re: Confused about motor oil prices

Most station owners I know pay COD on fuel. It prices are expected to rise they will charge more. When the 10,000 gals of higher priced fuel arrives they will have the money to cover it with profits not realized on cheaper fuel. The problem compounds with price, if the new price jumps say 50Ę a gallon and your load is 10K that alone means you have to come up with $5,000 dollars and you will dig deep to get it or no gas.
It works on both the upswing and downswing so it kind of comes out in the wash.
Just my take, the independent station owners I know aren't getting rich, but they do get by.
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Old 01-15-2016, 01:54 PM   #15
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Default Re: Confused about motor oil prices

its like farming......Corn hits $7 a bushel, cost follow...corn drops to $2 and cost stay as if it was still $7
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Old 01-15-2016, 02:26 PM   #16
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Default Re: Confused about motor oil prices

The answers in the math. At 168 quarts per barrel, the cost of crude is .59/quart at $100 a barrel and .21/quart at $35 a barrel. All the rest of the $4 quart of engine oil is labor, additives, packaging, shipping, and profit. The most price drop you should expect is .59-.21= 38 cents.
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Old 01-15-2016, 02:36 PM   #17
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Default Re: Confused about motor oil prices

when the price goes up it usually stays up. they created a market that held 4.00 gas. and food prices jumped. a pound of lunch meat turkey costs 8 a pound when it was 2-3. hamburger is up around 5 a pound. and will probably never go back down. look at the cost of 22lr ammo it was 1 cent a round now its 10 cents due to over demand. demand has dropped and the price is still 10. but yeah everyone eats so every one knows how much that cost has gone up.
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Old 01-15-2016, 05:01 PM   #18
SGT in Ont.
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Default Re: Confused about motor oil prices

Crude oil is refined for fuel. Motor Oil uses a completely different type of base oil when it is manufactured. The barrel price has no bearing on what the price for motor oil is going to be.
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Old 01-15-2016, 05:51 PM   #19
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Default Re: Confused about motor oil prices

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Originally Posted by SGT in Ont. View Post
Crude oil is refined for fuel. Motor Oil uses a completely different type of base oil when it is manufactured. The barrel price has no bearing on what the price for motor oil is going to be.
This statement is not true!, Motor oil is refined from Petroleum hydrocarbon base stock which is derived from crude oil. The price of motor oil is very much related to the cost of crude oil.
Wayne
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Old 01-16-2016, 01:09 AM   #20
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Default Re: Confused about motor oil prices

Quote:
Originally Posted by spinelll View Post
Please explain this equation to me:

  • Crude oil price rises ($100+/barrel) = gasoline price rises ($4.00+/gal) = motor oil price rises ($4.24/qt). Understood.

  • Crude oil price falls ($35/barrel) = gasoline price falls ($1.87/gal) = motor oil price remains the same ($4.24/qt). Not understood.

How is it that Iím paying $1.87 for a gallon of gas and $17.00 ($4.24/qt) for a gallon oil?
They are going to charge what you are going to pay, simple.

Did you know that with diesel at it lowest price since 2004 and gas at it's lowest price since 2008, UPS still charges a fuel surcharge for the same reason, If you are going to pay it they will continue to charge it.
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