Googling the question, 'economics of crude oil ?' I came up with the following info and thoughts about the subject. 'What are the products and uses of petroleum ?' "Petroleum products include transportation fuels, fuel oils for heating and electricity generation, asphalt and road oil, and the feedstocks used to make chemicals, plastics, and synthetic materials found in nearly everything we use today. About 76% of the 6.97 billion barrels of petroleum products that were consumed in the United States in 2014 were gasoline (47% of total petroleum consumption; includes biofuels), heating oil and diesel fuel (21%), and jet fuel (8%)." https://www.eia.gov/tools/faqs/faq.cfm?id=41&t=6 Declining Consumption of Crude higher mpg - lying aside electric engines propane engines natural gas heating home insulation recycling wind turbine electricity generation solar electricity generation ( most home users generate and sell excess electricty to grid ) others ? zip contains 3 pdfs: 'What Drives Oil Prices' U.S. Energy Information Administration 'New Economics of Oil' Spencer Dale group Chief Economist 'The Economics of Lower Oil Prices' Chris Lafakis Senior Economist Moody's Analytics
I'm saying it's a floor (bottom, support, etc.), not necessarily a fair price. It hasn't stayed in that range since 2002-2003, so if you think $20-25 is too high, the burden of proof is on you to show why.
From what I've been told by people who own gas stations, they make most of their money selling soft drinks, beer and snacks. I've never understood why people buy a Coke and chips every time they fill up, but some do. Having said that, they can't really lose money selling gas either, but the profit margins are pretty tight.
If you have a small grocery store nearby, people buy the coke and chips for home, but small towns the gas station is often where you meet up with someone you know and chat while so often times it is a meeting place. The cost to haul that fuel far distances and have to pay for fuel truck to return as well are reasons why so expensive. Many farmers buy 500-1000 gallons at a clip so they not buying from Mom and Pop gas stations. When I was a kid, there was no buying soft drinks like now, Dad would give me a dime after doing week's worth of chores and I would go down to "filling station" and buy bottle of Pepsi, on side of machine was bottle opener as all bottle of glass had cork under the lids to keep the sealed pressure, and when done we would take to grocery store for 2 cent deposit back. Oh, gas was 24 cents in mid 1960s. No one kept house keys cause we never locked doors, leave your bike out front unlocked, people just didn't think about ripping you off like now. Go to the movies and watch 2 movies with cartoons before the movies. Saturday mornings parents give us 30 cents to go down to movies and watch kids movies, Westerns or cartoons, have enough for hot dog, candy and a pop(soft drink). To me better times that now. Bleachers at Cubs games were 70 cents in the 60s, LOL the cheap seats but fun.
%% NOT going into comment on $20-25 oil-that is too counter-Trend for me. In fairness to that trader, he said floor , not his price target i figure.LOL