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Business, Energy, STEM, Uncategorized

Crude Oil Less Than Distilled Water for 2015 Holiday Season

GasPump_DresserWayne_GreeceWhile driving with a friend yesterday, we passed a number of service stations that were selling regular gasoline for less than $2.00 per gallon.  Some were advertising regular at $1.85 and Costco’s price was $1.79.  My last discussion on this topic, Retail Gasoline Price Check for the Start of the 2015 Holiday Season, was published on November 14, 2015 – about two weeks before Thanksgiving. The national average for a gallon of gasoline on that day was $2.167.

I’ve been waiting for regular gasoline to drop below $2 per gallon. Today’s U.S. average price is $2.027 and Arizona’s average is $2.002. However, in metro-Phoenix it is $1.977 and good enough for me. (Source: GasBuddy.com)

What furrowed my brows today was a post in Oil Pro’s newsletter that noted that the cost of a gallon of crude oil is less than the same amount of distilled water.  Mike Rasco, oil and gas consultant, provides the comparison and shows that the current price of a barrel of crude was trading earlier today at $39.22. With 42 gallons per barrel, this comes to $0.934 per gallon.

You might find distilled water at Wal-Mart for about $0.90, however, you probably won’t leave the Dollar Store paying less than $0.99. Other places sell it for $1.19 or more per gallon.

Rasco creatively shows how today’s cost of one gallon of gasoline compares with a gallon of other items (Note: Most of these items are not usually sold in gallon quantities.):

  • Hydrogen Peroxide – $10.32
  • Ketchup – $8.00
  • Domestic Beer – $5.33
  • Low Fat Milk – $3.79
  • Soy Sauce – $15.33
  • Black Printer Ink – $2,560
  • Insulin – $9,411
  • Chanel No 5. Perfume – $25,650
  • Scorpion Venom – $38,858,507

After reviewing the above price list, I consider the current cost of gasoline in the U.S. a grand bargain. U.S. motorists are getting an early Christmas present with extra dollars to spend on other items this December. Although Rasco does not say what type of crude oil he uses for his analysis, Bloomberg reported that West Texas Intermediate (WTI) closed at a price of $37.86 per barrel.

Happy holidays and happy motoring.

References

  1. By The Gallon, Oil Now Costs Less Than Distilled Water, by Mike Rasco in Oil Pro, December 7, 2015, http://oilpro.com/post/20673/gallon-perspective

 

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About Vi Brown

Vi is principal and CEO of Prophecy Consulting Group, LLC, an Arizona firm that provides business and engineering services to private and public clients. Prior to establishing her consulting practice in 2001, Vi worked with Motorola, Maricopa County Government, Pacific Gas & Electric, CH2M Hill, and Procter & Gamble. As an adjunct faculty member, Vi teaches undergraduate calculus classes and graduate level environmental courses. She is also a professional speaker.

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Trackbacks/Pingbacks

  1. Pingback: Gas Prices Expected To Remain Lower For Longer | BridgeBizSTEM - January 9, 2016

  2. Pingback: Price Updates for Gasoline and Crude Oil | BridgeBizSTEM - July 23, 2016

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