As I see it the US oil market has been divided into two different segments.
There is the North Sea Brent price that applies to crude that is imported by tanker ships and the West Texas Intermediate price that applies to landlocked oil backed up in the Midwest by inadequate pipe line capacity. At the moment Brent is at about 124 bucks and WTI has been depressed to about 107 by Canadian oil sands production and domestic production from ND.
Most of the US population lives within a few hundred miles of the coast so the cost of their gasoline is determined by the Brent price. As I have said before folks in mid-continent get a bit of a break but the refineries (naturally) pocket most of the difference between Brent and WTI.
Those Mid-west refineries are running flat out to take advantage of the higher prices on the coast as it is easier and cheaper to transport “products” than it is to transport crude. Consequently this raises prices a little higher in the Mid-west than they otherwise would be and is depressing prices on the coast to the extent that the coastal refineries are losing money. That is to say:-- the cheaper feedstock for the Mid-western refineries gives them far more price advantage than any penalties for freight.
Because of this and falling US demand Northeast refineries are shutting down or at least exporting finished product to take advantage of higher prices overseas . . . this accounts for a lot of the media crap about the US becoming a “net exporter” of oil.
US gasoline prices are determined by North Sea Brent prices plus profits. The oil price touted by the media is the price of discounted landlocked WTI out of Cushing and has bugger all to do with what folks in the US pay for gasoline.
The big problem as I see it is that once that Keystone pipe is flowing all that Mid-west oil will assume parity with Brent and the average prices for fuel across the US will see very little change . . . apart from the fact that folks in the Mid-west will probably pay a little more.