The ‘real’ oil price is a lot higher than it looks
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The real price of oil may be over $30 higher than the tracked price, potentially keeping gasoline prices high. Spot crude prices are trading above $135 per barrel, while futures prices are down 13% to under $100 per barrel.
The price of oil may be higher than it seems. Most investors track Brent or West Texas Intermediate crude, which are down 13% to under $100 per barrel. However, spot crude prices in the North Sea are above $135 per barrel. This discrepancy is due to the physical market reflecting the current shortage of oil. Over 10 million barrels of oil are offline daily, representing 10% of global supply. As a result, buyers are competing for remaining barrels, driving prices up. This impacts the price consumers pay at the pump, currently averaging $4.15 per gallon.
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