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Discussion Starter #2
Gasoline is refined from crude oil, and the cost of that crude oil sets a floor for the wholesale price of gasoline. There are 42 gallons in each barrel (bbl) of crude, so a crude oil price of $84/bbl means that the raw feedstock costs the refiner about $2/gal. Break-even processing costs to turn the crude oil into gasoline are typically $4/bbl to $5/bbl, so an $84/bbl crude price suggests a minimum wholesale cost at the refinery of about $2.10-$2.12/gal. Transportation, various taxes, and retailer mark-ups account for the rest of the price of fuel.
 
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