Market Dynamics - Crude oil prices are influenced by global supply disruptions, OPEC decisions, and macroeconomic factors [1] - Gasoline prices are affected by regional markets, refining costs, crack spreads, and local factors like transportation, taxes, and environmental regulations [2] Cost and Pricing Factors - Gasoline prices incorporate refining costs and the profit margin from processing crude [2] - US gasoline requires seasonal blends, with summer formulations being more expensive to produce [2][3] - Retail gasoline includes fixed taxes, about 18% federally plus state variations, which insulate it from crude oil volatility [3] Inventory and Demand - Ample crude stockpiles can depress oil prices, while low gasoline reserves amid high driving demand raises pump prices [3] Structural Differences - Crude oil is a globally traded commodity, while gasoline is a refined product with regional markets [1][2] - These layers create lags and mismatches allowing opposite movement despite crude being gasoline's primary input [3]

Group 1 - Valero Energy (NYSE: VLO) is expected to have a strong quarter due to improving crack spreads and increased utilization of its refinery assets [1] - The company is positioned to continue stock buybacks as a result of its favorable operational performance [1]