When President Trump announces yet another potential peace agreement with Iran, crude oil prices fall, and Americans make the mistake of thinking that gas and diesel prices will follow. But crude oil isn’t the right barometer of your pain at the pump. By the end of July, crude oil prices had fallen about 25 percent from their April peak, while gasoline prices dropped only about 9 percent after peaking at around $4.50 a gallon in May.

With prospects for peace fading again, both gas and diesel resumed their upward path, with gas at $4.07, while diesel reached $5.47 nationally.

Focusing on the price of crude is misleading, a bit like following the price of wheat when it’s bread that you’re actually buying. The gauge to watch is what’s called the crack spread — the difference between the cost of a barrel of crude and the prices of the refined products made from it. If you want to drill down, it’s often referred to as the 3-2-1 spread, which calculates prices when three barrels of crude are refined into two barrels of gasoline and one barrel of diesel, a typical ratio. (Cracking is the process of breaking large hydrocarbon molecules into smaller ones, which is what a refinery does.)

When crude oil prices fall faster than gas and diesel prices, the crack spread widens. This disconnect is known as the “rocket and feather” effect, in which retail gasoline prices escalate quickly as crude oil prices rise, but drift down slowly when prices start to fall. When wholesale prices of gasoline spike, service station owners raise prices quickly because they know their future gas deliveries will be more expensive. They might also notice that competitors are raising prices and act accordingly, as nobody wants to sell today’s fuel at yesterday’s price and forego the profits.

Conversely, when station owners see wholesale costs start to fall, they’re not necessarily in a rush to cut prices and sacrifice profit margins — at least until customers start to notice. The result is a retail market that tends to overreact to bad news and only grudgingly responds to good news.

More recently, there’s been an added supply twist tied to Russia. Ukraine’s drone bombing campaign has disabled swaths of Russia’s refining capacity, which could decrease the country’s supply by up to 28 percent from last year.

In the Middle East, the Iran-U.S. conflict not only interrupted shipping through the Strait of Hormuz, but also damaged a number of refineries in the Persian Gulf. Similar to the situation in Russia, refining capacity remains well below prewar levels even as crude production in the region begins to recover. War in Ukraine and the Middle East could end immediately, but damaged refining capacity will take a long time to restore — and there aren’t a lot of new refineries under construction in the rest of the world.

In fact, even if crude production rises, it doesn’t help much when some 9 percent of global refining capacity is offline. Refining capacity is now the bottleneck that is squeezing fuel prices higher worldwide, diesel in particular. Russian and Middle Eastern refineries yield more diesel per barrel than U.S. refineries, which lean toward gasoline, so losing that output hits diesel supplies harder. That’s why diesel prices have fallen less than gasoline since their April peaks.

Another big player that is making waves is China, which is both the world’s largest crude importer and its largest refiner. At the start of the Iran-U.S. conflict, China began cutting crude oil imports, which are now at an eight-year low, drawing on domestic stockpiles to avoid rising prices while freeing up barrels for other refiners. That eased pressure on crude oil prices.

China wasn’t necessarily playing the good guy. While it was limiting imports, China also restricted exports of gasoline, diesel and jet fuel. That pulled Chinese barrels out of a global market that badly needed them, tightening supply everywhere else and pushing fuel products’ prices up. This isn’t a temporary market reaction; it is a structural change.

And you’re paying for it. Through July, in our peak driving season, data from the Energy Information Agency indicates that wholesale gasoline and diesel prices are up about 59 percent and 69 percent, respectively, over a year ago. That’s way more than the 36 percent increase in crude oil prices.

The impact goes well beyond your commute and into the broader economy. Diesel is the workhorse of the real economy. Diesel moves goods by truck and rail; it makes harvesting crops possible, and is critical in the construction of homes, buildings and factories. That’s why the U.S. Postal Service has temporarily raised rates for package delivery. Jet fuel prices are expected to be up by about 70 percent this year, increasing airlines’ operating costs, sending fares higher. All of this makes the Fed’s job of moderating inflation more difficult.

The world isn’t running out of oil. It is running out of places to turn that oil into fuel. Which means the price of refined products such as gasoline will remain high. And that could be a far more vexing problem to fix.