While crude oil prices have declined significantly over the past month, gas prices remain elevated. According to GasBuddy, across the United States, gas prices average $4.11 a gallon. While oil prices have declined almost 20% from their March high, the average gas price indicates a 5% decline over this period. This is not unusual. According to Ben Storrow, a reporter for E&E News, gas stations do not immediately hike prices when oil prices go up, but they do so aggressively once they start raising prices. However, when oil prices decline, gas stations lower the prices gradually. This strategy helps them benefit from the significant difference between buying and selling prices.
Furthermore, seasonal gasoline demand is estimated to rise and might garner significant profits for the big sellers. According to a Visiongain report, the global liquefied petroleum gas market is projected to grow at a 5% CAGR from 2022 to 2032. Investors’ interest in the gasoline industry is evident in the United States Natural Gas ETF, LP’s (UNG) 46.6% returns over the past three months.
