How to Calculate the Price of Gas in Relationship to the Price of a Barrel of Oil

A gallon of gas is roughly 3 percent the cost of a crude barrel.

Whether its trouble in foreign markets, the discovery of a new reserve or importation woes, there are any number of factors that can cause fuel prices to fluctuate. If you desire to see how changes in crude prices affect your fill-up here at home, you can employ a rather rudimentary ratio and equation. Keep in mind that true figures will depend on location and suppliers' pricing.

Things You'll Need

• Price of barrel or gallon

Instructions

1. Find the price per barrel of crude. You can now figure out what percentage the price per gallon of gas is in relation to the barrel of crude.

2. Take the price per barrel and multiply it by 0.033. The price per gallon of gas is roughly 3 percent of the barrel price. For example, if the price of the crude barrel is $100, the price per gallon of gas is roughly $3.

3. Reverse the equation. To figure it out beginning with gas price, take the gas price per gallon and multiply it by 33. This will give you the approximate crude price per barrel. To continue the above example: $3 per gallon x 33= 99, or approximately $100.

4. Consider markets. There may be significant regional differences in gas prices that make simple calculations less accurate. These could include supply and/or demand issues such as a single gas vendor or importation problems. Either one of these factors could spike prices at the pump.

Tips & Warnings

• There is actually a delay between when a barrel is filled and when it actually arrives in gas form on the market. Gas Calc estimates this at "3-6 months." This makes it slightly more difficult to isolate when price changes occur and how it relates to any specific shipment of crude.

References

• Gas Calc: If the Price of One Barrel of Oil Is: Then the Price of One Gallon of Gas Would Be?: