Financier №3 (43) 2026

Conflicts in the Middle East sharply drive up oil prices, as the region is a key supplier of crude. However, once the situation stabilizes, the price of “black gold” returns to previous levels.

Interestingly, retail gasoline prices in most countries do not react to the cheapening of raw materials; in some cases, they continue to rise even as the price of crude stabilizes. Why don’t changes in the exchanges always correlate with the dynamics of prices at gas stations?

Rockets and Feathers

Economists have also noticed that the price of gasoline at filling stations shoots up like a rocket when oil prices rise, but falls slowly, like a feather. This phenomenon is literally called “Rockets and Feathers”. In 2022, the Federal Reserve highlighted this effect as one of the persistent anomalies in the retail fuel market. There is a technical explanation for this: the logistics lag. The gasoline sold at a gas station today was purchased at wholesale prices two to four weeks ago, when oil was more expensive. A 2026 study by Energy Economics shows that the retail price reacts to any increase in the cost of oil, but requires a significantly deeper decline in oil prices before gas stations start reflecting it on their price tags.

From one barrel of oil - approximately 159 liters - only 72–76 liters of gasoline are produced.

In the USA, the price of gasoline is particularly sensitive to oil shocks due to a relatively low tax base, a highly competitive environment, and a high degree of dependence on exchange trading. According to EIA estimates, the cost of a gallon of gasoline depends 65–75% on the dynamics of oil prices (primarily Brent and WTI) and petroleum products, as well as RBOB futures, which serve as a benchmark for the wholesale cost of gasoline in the US. Taxes, logistics, refining, and the retail markup account for the remaining 25–35%.

The situation is different in Europe. Fixed taxes form about 55–60% of the cost of gasoline. As a result, price waves typical for raw materials reach gas stations in a significantly weakened form. Authorities also get involved in regulation. Germany, for example, reduced the tax on gasoline and diesel for two months, which helped lower fuel prices by approximately 17 eurocents per liter.

In Kazakhstan, the link between oil and gasoline prices has been broken even more radically. From 16 October 2025 to 31 March 2026, the country had a moratorium on raising prices for AI‑92 and diesel fuel. Amid Brent crude's surge to $120 in March 2026, the retail price of AI-92 was fixed at the mid-October 2025 level (around $0.53 per liter). Meanwhile, AI-95 and AI-98, which were not subject to the moratorium, increased significantly. The price difference between different fuel grades reaches up to 35%, significantly exceeding global standards. Additionally, Kazakhstan refineries buy crude at a discount, so local refiners can sell fuel cheaper than in the rest of the world, without taking into account the dynamics of external markets. It is also worth noting the ban on exporting gasoline and diesel from the country, as such attractive prices for visitors could cause a shortage within Kazakhstan itself.

The correlation between global oil prices and the cost of gasoline is effectively absent in key CIS countries, including Russia, Belarus, Turkmenistan, Uzbekistan, and Azerbaijan. In these countries, exchange fluctuations in oil prices reach gas stations only partially and with a delay: the final price largely depends on government decisions, taxes, and regulatory mechanisms.

Full Tank

In many countries, retail gasoline prices at stations are determined by domestic factors - such as fixed taxes, excise duties, and local business costs (logistics, wages) - rather than quotations on global exchanges. Even a significant drop in global oil prices does not always lead to a proportional reduction in fuel costs due to the high share of fixed costs, which reaches 60% in some countries.