In our previous article, we explored why gasoline prices don’t always move in sync with crude oil. The gap between the two is often surprising, and while many familiar factors play a role, several lesser‑known dynamics are just as important.

To understand the disconnect, it helps to look at the full hydrocarbon supply chain. Oil producers extract crude and send it to refineries, which convert it into gasoline, diesel, and other products. Retailers then sell these refined fuels to consumers. At every stage, companies are focused on profitability — and that shapes how prices behave.

When crude prices fall sharply, exploration and production companies take an immediate hit. Their infrastructure costs don’t disappear just because oil is cheaper. Alberta is a clear example: during the last major downturn, roughly 65% of rigs were temporarily shut down, sending shockwaves through the provincial economy.

Refineries, on the other hand, often take advantage of low crude prices by stockpiling. Seasonal changes, like the switch to summer‑blend gasoline, also increase refining costs. Pipeline constraints and rebounds in crude prices add further pressure. Yet despite all this, the rack price — what retailers pay for gasoline — doesn’t fluctuate nearly as dramatically as crude oil. Retail margins have remained steady at around nine cents per litre.

Why? Because many refiners are also producers and retailers. When crude prices drop, they offset upstream losses by keeping rack prices higher. And with summer demand at its peak, there’s little incentive to lower prices at the pump.

Financial speculation and broader market forces add another layer. While taxes and retail margins stayed relatively stable (aside from Alberta’s tax increase), major oil companies continued to post strong profits. The real strain is felt in regions whose economies depend heavily on oil production.

In short, the hydrocarbon market is complex — and crude oil prices are only one piece of the puzzle.