Gas is trading at $2.45 on wall street....why are we paying $3.50?

When I was younger I worked for a local gas distributor and we had 20 convenience stores. I live in Fl so I know what taxes and freight is here but not where you live. Rule of thumb for here is to add about 70 cents to the futures price to cover taxes, freight, overhead and mark-up. Mark-up is usually only 5 or 6 cent. BTW, that's the price you should see in a couple of weeks. The price you see today is whatever the future's was a couple of weeks ago. Also, the State of Florida is investigating some stores for price gouging.

Edit - I belive a couple of weeks ago the future's price was $2.80 - $2.90. Current price where I live is $3.80. Still a little high.

Well there are costs for transporting it to the corner station, mark-up by the station to make a profit and to cover their operating expenses, taxes both federal, state, and sometimes county. Those all add up.

Edit: Yes Cookie I know those all added up before when gas was $2.00, but back then gas was being traded for $1.00 and oil was $30 a barrel. Federal and State taxes have been (except when lawmakers increase them to raise more income) the same as their taxes are per gallon as opposed to a percentage with other purchases goods. However transportation costs have increased as gas is delivered by truck which use gas. They pay more for it also. Back when gas was $1.20 we were getting the oil and gas on the Commodities Markey far cheaper then today.

You're forgetting transportation and storage. The futures price is from a central hub and transportation is very expensive.

Retailer profit is higher than the 3% you cite also. Given that credit card companies charge about 3% your 10 cents profit figure wouldn't even cover the credit card levy. Retailer mark up is about 10%, not 10 cents. That's 30 cents.

Federal and state taxes are higher and you're forgetting sales tax. If sales tax for you is 6% that's another $0.18

You left out the cost of storage, dealing, selling, middle men, servicing customers etc. Also 10c markup at the pumps is far too little.

Compare how much the farmer gets paid for his apples and what you pay for them it at the supermarket.

By the way, if you want cheap gas, tell Bush to stop bombing the producers of it, one after the other.

I believe it is because Hurricane Ike has disrupted offshore production, pipelines, and refinery operations, in addition to creating excess demand for all the people who have evacuated in their cars. Oil has fallen to $90/bbl but it won't have an immediate effect on gas prices. Hopefully in a few weeks it will.

Funny...we were asking the same question.

As soon as the hurricane hit land....

up they went.

That's their new excuse.

$4.27 in Chicago for regular.

Paid $3.87 last week.

In addition, folks started relaxing more

with the prices going down. Gradually

started increasing their use again.....

so "bang"! Let's get them while the

usage is up.

Those are futures they are trading, what the price will be at a later date.

Greedy. Just plain greedy.

I wish I could pay 3.50.......

Last fill up was 4.19 a gallon for regular...........all this is ridiculous!!