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Thursday, October 27th, 2005

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Gas vs. oil
Okay, let me bore you with talk of commodities markets. I finally got around to looking at my car's fuel efficiency, you know, doing the little division ritual after filling up a tank of gas. I hadn't done the division since I'd bought the car, but I have nearly all the gas station receipts, going back to last November. Looking at the price per gallons then vs. now sorta made me cry ("why'd I wait so long to buy a car?!").

No big deal, I've heard that oil's been at its record highs, blah blah blah. But, the other day I heard a barrel of oil was going for $60 these days. Huh, I thought, we haven't been that cheap for a while, but gas is still expensive. Why? So, I got a bee in my bonnet to see what happens when you plot the cost of crude oil vs. gasoline. I was expecting to see some Evil Plot exposed showing that gas is way overpriced vs. the cost of crude for the last three weeks. I'd blog about it, place some well-positioned commodity futures trades, everyone would be so surprised and want to talk to me to learn more, I'd be famous! Okay, so, that all didn't happen.

Instead, I spent a couple of evenings fruitlessly looking for the price of crude on the Web. Turns out, it's sorta hard to do. [crude oil] or [price of crude oil] turns up plenty of news stories about what it's going for today (or the day the news was published). But if you want _historical_ information, you're a bit worse off. Okay, crude trades on the New York Mercantile Exchange (www.nymex.com), let's try there. Yes, they do list the price, but only the current prices, not historical data. And, besides, that's a futures market, and what I really wanted (I've learned) is the spot price.

Failing to find what I wanted at NYMEX directly, I tried Google for [historic prices nymex]. Shoulda just trusted Google: the #1 result is what I want - Dept. of Energy's Historical Petroleum Price Data. In fact, not only does this site hold historical information, it's *high quality* data, in *spreadsheet*. Want to know how much a gallon of regular unleaded cost on January 20th, 1997, on the docks in New York? This is the data you need. (It's $.6493/gal, btw.)

So, some fiddling around in Excel to make two-axis line charts, and I have a picture (click to see it bigger):

graph of oil vs. gas prices

Three things struck me from this graph. First, there's a big spike in the cost of regular gasoline at the end of August 2005, which I'm guessing is because of Hurricane Katrina. Second the oil vs. gasoline price ratio actually hasn't changed very much in the last year, and in fact the price of gasoline has dropped more rapidly than that of oil. So, in fact, it seems that there's less money being made per gallon of gasoline than before. And, despite my memory to the contrary, the price of a barrel of oil last January was still in the $40 - $50 range. $60 is still much higher, so it's not surprising that I'm still paying over $3/gal for super unleaded in the Bay Area.

And there you have it. Fun with Excel, with learning about the DoE site, and with deciding that no one's probably making a much bigger killing in this market now than they were a few weeks or months ago. I guess I won't run off to play on the futures market for crude or gasoline prices.

Oh, one more thing: if this all _does_ sound exciting to you, you should check out the game McMulti. It's basically the same thing as all this, but in a game. Build refineries, drill for oil, sell gasoline to consumers and make a profit at the pump. Fun for four people at a time (more if they like sitting quietly and watching).

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