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Crude oil and gasoline are the most closely watched commodity pair in global energy markets — one the raw extracted feedstock, the other its most commercially significant refined derivative. Their prices are structurally linked, but they diverge regularly.
Escalating geopolitical tensions across the Middle East in early March 2026 sent both of these energy commodities spiking within days, even as major forecasting bodies maintained projections of a global supply surplus through the remainder of the year.
While closely related, the price dynamics of crude oil and gasoline may differ, sometimes quite substantially. This is why a drop in oil prices may not always be reflected in lower retail prices at gas stations — a common occurrence that has undoubtedly frustrated many of the over one billion car drivers worldwide.
In this article, we examine these two critical, related commodities, their interrelationship and the key factors affecting their prices.
Key Takeaways:
Crude oil and gasoline prices move in the same direction most of the time, but crude accounts for only 50%–60% of the wholesale gasoline price, meaning that the two markets can and do diverge significantly.
Refinery outages, seasonal blend requirements and regional supply constraints can push gasoline prices higher, even when crude prices are falling, which is why trading one commodity purely on the other's price action is a critical mistake.
Crude and gasoline can both be traded on Bybit TradFi as contracts for difference (CFDs).
Often dubbed “liquid gold,” crude oil is a major unrefined commodity extracted at both onshore and offshore locations. It’s the primary material for refined petroleum products, including gasoline, diesel fuel and jet fuel, among many others.
Crude oil doesn’t trade as a single uniform product. Dozens of distinct grades reach the market, each priced relative to a benchmark based on its refining characteristics and geographic origin.
The three main benchmarks are as follows:
WTI (West Texas Intermediate) — A light crude oil grade, priced at the Cushing, Oklahoma delivery hub and traded on the New York Mercantile Exchange (NYMEX)
Brent — A North Sea crude oil blend that serves as the reference price for roughly two-thirds of internationally traded crude, traded on the London-based Intercontinental Exchange, Inc. (ICE)
Dubai/Oman — A benchmark for Middle Eastern grades sold into Asian markets
Both WTI and Brent crude oil trade primarily via futures contracts in standardized lots of 1,000 barrels. Beyond futures, crude oil is also traded through the spot market and via contracts for difference (CFDs). You can trade both WTI and Brent crude oil on Bybit TradFi as CFDs.
Gasoline is a refined oil product that’s one of the most actively traded energy commodities globally, alongside crude oil and natural gas. Like crude oil, gasoline can be traded on spot and futures markets, as well as via CFDs. Gasoline can be traded on Bybit TradFi as a CFD.
At the wholesale level, the benchmark contract is RBOB (Reformulated Blendstock for Oxygenate Blending), a futures contract on the NYMEX. Each RBOB contract represents a standardized contract for 42,000 gallons, equivalent to 1,000 barrels, and serves as the reference price used across US wholesale markets.
Gasoline prices are driven by a few key factors:
Refinery output levels — How much gasoline refineries are producing at a given time
Regional fuel inventory data — Weekly data published by the US Energy Information Administration (EIA) that signals supply shortages or surpluses
Seasonal shifts — Every June 1, stricter summer fuel standards kick in, limiting supply and pushing gasoline prices higher
Taxes — A federal excise tax of $0.184 per gallon is added before gasoline reaches consumers
Crude oil is the primary input cost in gasoline production, and the two markets move in the same direction the majority of the time. When crude rallies, gasoline wholesale prices follow suit. When crude sells off, gasoline prices typically drop alongside it. That directional correlation is strong and well-established across both spot and futures markets.
The relationship is not one-to-one, however. Under normal conditions, crude oil accounts for roughly 50%–60% of the wholesale gasoline price, meaning that other cost components — taxes, distribution, regional supply balances and seasonal specification requirements — independently influence gasoline’s trading price at any given time.
This is why the two markets can and do diverge. Gasoline can rise while crude is flat, and crude can drop sharply while gasoline barely moves. The factors driving those divergences are distinct from the factors driving crude oil. Understanding the differences between the two commodities is what gives traders an edge in energy markets.
OPEC+ production decisions are among the most powerful drivers in crude oil pricing. When the alliance cuts output, supply contracts and prices tend to rise. When it increases quotas, the market absorbs the surplus, and prices fall.
Geopolitical risk sits alongside OPEC+ as a primary driver. Conflict or instability in major producing regions — the Middle East, Russia, West Africa — triggers immediate risk premiums in futures markets, often before any actual supply disruption materializes. The early March 2026 spike caused by the outbreak of war in Iran is a direct example of this mechanism.
US inventory data, published weekly by the EIA, moves crude oil on a shorter time frame. A larger-than-expected build signals weak demand or excess supply, while a draw signals tightening conditions. Traders price these reports within minutes of their release.
The strength of the US dollar also matters. Crude oil is denominated globally in USD, so a stronger dollar makes oil more expensive for foreign buyers, and typically suppresses demand. A weaker dollar has the opposite effect. Global GDP growth expectations are also among the factors affecting crude oil prices, though typically less influential than OPEC+ decisions or large regional wars.
Oil is the starting point for gasoline pricing, with at least 50% of its pricing affected by crude oil costs. However, several other factors influence RBOB, regardless of whatever crude oil’s price is doing on any given day.
Refinery capacity directly controls the amount of gasoline that reaches wholesale markets. An unplanned refinery outage in a major production hub can tighten regional supply within days, and can push RBOB sharply higher — irrespective of where WTI or Brent is trading. Planned seasonal maintenance in spring reduces available supply precisely when demand is building into the summer driving season.
Seasonal specification changes add another layer. The annual transition to summer-blend requirements beginning June 1 restricts which refineries can supply compliant products and raises production costs, exerting upward pressure on RBOB, independent of crude oil prices.
Similar to crude oil, regional inventory levels reported in the EIA weekly data move gasoline on a shorter time interval, too. Demand seasonality — peaking in summer, softening in winter — creates a predictable annual price cycle. Ethanol blending mandates and state-level tax changes can also shift retail prices independently of movements in crude futures.
The crack spread is the difference between the price of crude oil and the price of the refined products produced from it, such as gasoline and diesel. It serves as a major indicator of refinery profit margin in real time, and is one of the most closely watched signals in energy trading.
The most common benchmark is the 3:2:1 crack spread: three barrels of crude refined into two barrels of gasoline and one barrel of diesel. This formula subtracts the cost of three barrels of crude from the combined revenue of two barrels of gasoline and one barrel of diesel, divided by three, to express the resulting cost per barrel.
Refiners trade crack spreads on NYMEX and ICE to lock in margins. Traders use them directionally — a widening spread signals tightening product supply or strong demand, while a narrowing spread signals the opposite. Crack spreads typically widen in spring as summer-blend production costs rise and driving season demand picks up.
A falling crude oil price doesn’t guarantee a decline in gasoline prices. The two markets respond to different supply signals — signals that frequently point in opposite directions. Common scenarios for the divergence include the following:
Refinery outages cut gasoline supply without touching crude inventories
A surge in summer driving demand tightens product markets, while crude oil stocks remain comfortable
Seasonal specification changes raise RBOB production costs, independent of crude prices
Regional pipeline or distribution constraints can strand supply in one market while the other market is doing well
In each case, the gasoline-specific factor may outweigh the crude input cost. Traders who watch only crude oil and assume gasoline’s price will follow repeatedly get caught on the wrong side of these moves.
It’s important to keep in mind that crude oil and gasoline are related — but distinct — markets. Trading one of these commodities based purely on the other one's price action is a structural mistake. As noted above, a myriad of factors regularly lead to divergence in the two commodities' price dynamics.
Crude oil and gasoline share a structural price relationship, but they are distinct markets driven by overlapping and independent factors. Crude oil responds primarily to geopolitical risk, OPEC+ supply decisions and macroeconomic demand signals. Gasoline responds to those same inputs — but also to refinery capacity, seasonal specifications, regional inventory levels and distribution constraints that often have little to do with factors affecting the price of crude oil.
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