Hey, now we can take those oil barrel prices and figure what that means at the gas pump! Today in the Wall Street Journal, they pegged the cost of crude to gas pump prices:

Many analysts consider $4-a-gallon retail gasoline across the U.S. a foregone conclusion this summer driving season, a period of typically peak demand, but those estimates take only current record-high oil prices into account. Thursday, light, sweet crude futures breached $135 a barrel, more than double the price a year ago.

If oil hits $200 a barrel, which is the upper end of Goldman Sach’s prediction for prices over the next six months to two years, the gasoline picture changes quite dramatically. At $200 a barrel, crude alone would cost $4.76 a gallon. Add on the costs of refining and distributing as well as taxes, and pump prices could rise to a range of $6 to $7 a gallon.

Not sure where they got these numbers, but they’ve thrown out the index here. So let’s just be conservative and say that at $200/barrel, the cost of gas will be $6/gallon. This means that the oil barrel price to price per gallon multiplier is $6/$200 = .03.

Does this hold? $137/barrel * .03 = $4.11/gal. I guess it seems like a good number - San Francisco is reporting over $4/gal in prices.

Most economists are predicting that oil will go to $150/barrel by the end of the summer. If that’s the case, then we are looking at $150 * .03 = $4.50 average by the end of the summer. Let’s see if this prediction measures up to reality.

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