How are gasoline prices determined?
Not by us
The price of crude oil is the main determinant of the price of gasoline, but refining costs, federal, state and local taxes, as well as marketing and distribution costs also affect gasoline prices. The price of gasoline varies by state and region because of differences in gasoline specifications, state and local taxes, and costs to transport fuels into the state or region.
The price of gasoline is constantly changing. In 2019, the cost of crude oil accounted for 54% of the price of a gallon of gasoline. Refining costs and profits accounted for about 13% of what we paid at the pump. Refining costs include wages, equipment, financing, energy, and profits. Marketing and distribution adds another 15% to the retail price. Combined, federal and state taxes account for an average of 18% of the price of gasoline. Sales taxes along with taxes applied by local and municipal governments are also added and can have a significant impact on the price of gasoline in some locations.1