(WCCO) Our up-and-down relationship with gasoline is headed south again. A Web site that tracks prices says on average Twin Cities' drivers are paying less than $2.60 a gallon again.

Despite that slight drop, gas prices are actually up about 50 cents in the last two months. However, this time, some experts say the usual suspects like "Big Oil" or supply and demand are not to blame.

"It's not supply and demand," said David Morris, an energy policy expert in Minneapolis. "On a daily basis what causes volatility is trading."

Oil is a commodity just like corn and soybeans.

"In fact crude oil is the single most actively traded commodity in the world," said Morris.

It's traded on NYMEX or the New York Mercantile Exchange. That is where they set the price of oil we see on the news. Some of it is based on supply and demand but lately the price is largely influenced by speculators.

"Speculators decide that means the price of oil will go up. They're guessing that," said Morris. "But in guessing that, they bet that and in betting that the price of oil goes up."

That is because the oil companies and wholesalers often base their price on the NYMEX price, which means part of what we pay is based on speculators guesses.

"At four o'clock in the afternoon the oil companies tell the gas stations, that is the retail gas stations know what they will be charging at six o'clock that night from the refinery," said Morris. "And then the gas station changes its price."

The problem is that speculation is based on things that may not occur. For example, when Iran captured those British sailors the price of oil went up because speculators thought Iranian oil supplies may tighten if a wider conflict ensued. That pumped up the price we pay at the pump within one day. The tensions now appear to be easing so the price of oil is coming down.

"That's why you wake up in the morning and you see a different price," said Morris.

But how come gas prices often jump 10 cents overnight but take so long to go down?

Economists call that "stickiness" and it may be our fault. As prices fall, we don't shop around as much. Therefore, stations have little incentive to lower prices quickly. That's why gas stations actually make more money when prices go down than they do when they jump up.

- from WCCO, Good Question, Ben Tracy reporting