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(CNN Money) Those anxiously watching the rally in U.S. oil prices over the past few weeks have received a pleasant surprise at the pump: while oil has shot upward, gasoline is moving in the opposite direction.
The moves may seem counter-intuitive, since crude oil is used to produce gas. But while the two are closely related, there are a number of factors that can push their prices apart in the short term.
U.S. oil prices are up nearly 9% over the past month and have pushed above the $100 a barrel mark. At the same time, the average retail price of a gallon of gasoline has dropped to $3.30 as of Wednesday from around $3.45 a month ago.
Retail gasoline is more expensive than crude oil because of additional costs such as taxes, distribution and the refining process.
Historically, oil and gas "have always moved in tandem," with gas prices following on oil moves within three to six months, said Patrick Vahid, a senior trader at Sonic Futures. They do face different supply-and-demand forces, however, and are sometimes pulled in opposite directions.
For one thing, gasoline isn't the only product for which crude oil is used.
The U.S. Energy Information Administration says for every barrel of crude oil produced in America in 2010, just 42% went to gasoline.
The rest was divided among other products including diesel, jet fuel and consumer goods such as tires and ink. Demand for these products also goes some way to shaping oil prices. Diesel, in demand as a generator of electricity in the developing world, has become more expensive in recent months. Read full story at CNN Money...
