Crude oil makes up the largest percentage of the cost of a gallon, but its not the only thing you are paying for at the pump.
WASHINGTON — Gas prices continue to hover at near-record highs. The state of Maryland has already taken a gas tax holiday. Virginia is looking at one as well.
Beyond the gas tax, there are several other items priced into that gallon you buy, but the big-ticket part is cost of crude oil.
What factors make up the price of a gallon of gas?
OUR SOURCES:
ANSWER:
A gallon of gas breaks down into several costs: price of crude oil, taxes, the cost of refining and the cost of distribution and marketing.
WHAT WE FOUND:
“The biggest single factor that drives changes in prices of gasoline is a change in the price of crude oil,” Mark Finley said. “And the price of crude oil is not controlled by the companies. It's set in a global marketplace as a result of global trends in demand and supply.”
“A little more than half of the price of the gasoline relates to the price of crude oil,” Ed Hirs said. “Now, of course, that percentage has been up a little bit here recently, as much as two-thirds of it.”
The EIA has those percentages broken down on its website. As of February 2022:
- Crude oil makes up about 61% of that total price.
- Oil refining makes up 14%.
- Taxes 14%.
- Distribution & marketing round out that last 11%.
This is all for the average gallon of gas in the US. But gas stations set their own prices, so it’ll vary from station to station.
How much does the gas station make off that gallon gas?
Our experts said it’s a lot less than you imagine. On average, gas stations make about 5 cents per gallon of gas sold.
FAQs
ANSWER: A gallon of gas breaks down into several costs: price of crude oil, taxes, the cost of refining and the cost of distribution and marketing.
What do you pay for a gallon of gas? ›
The Energy Information Administration boiled it down to four general categories. Crude oil is the biggest piece of the pie making up about 57% of the price of a gallon of gas as of 2022. Then comes refining and profits at 17.7%, followed by distribution and marketing at 12.4%, then federal and state taxes at 12.8%.
What costs go into a gallon of gas? ›
The primary factors impacting gasoline prices are global crude oil cost (50%), refining costs (25%), distribution and marketing costs (11%) and federal & state taxes (14%), which are generally reflected in the wholesale costs that gasoline retailers pay to distributors.
How much would 1 gallon of gas get you? ›
Broadly speaking, most modern cars can drive 20 to 35 miles on a single gallon of gas. Indeed, this is about how many miles you have left when the gas light comes on in your car.
How much profit is in a gallon of gas? ›
Retailers Make Very Little Selling Gas
Generally, the markup (or “margin”) on a gallon of gas is about 15 cents per gallon (gross profit before expenses). Factoring in expenses, which include rent, utilities, freight, labor and credit card fees, a retailer is left with about 2 cents per gallon in profit.
How much does a gallon of gas waste? ›
A typical passenger vehicle emits about 4.6 metric tons of CO2 per year. This assumes the average gasoline vehicle on the road today has a fuel economy of about 22.2 miles per gallon and drives around 11,500 miles per year. Every gallon of gasoline burned creates about 8,887 grams of CO2.
How much gas does $100 get you? ›
For $100, most people can afford only a tank and a half or so of gas. For smaller cars, refilling a gas tank might cost around $58; for larger cars, a gas tank refill might cost closer to $77, using the national average gas prices from AAA.
Why is a gallon of gas so expensive? ›
Underlying the higher costs of gas are routine factors including refinery maintenance, the switch to summer gasoline and rising demand. Domestic supply is also impacted as refineries take advantage of milder weather conditions to do necessary maintenance.
What state is gas the most expensive? ›
Average gas prices are highest in Hawaii, lowest in Oklahoma
11, 2024, the highest average gas price is in Hawaii at $4.68 per gallon. That's followed by California ($4.62) and Washington ($4.04). Source: AAA.
How many gallons of gas does $10 get you? ›
Since gas is $2.50/gallon and you buy $10 worth, that says you'll get 4 gallons of gas ($2.50 * 4 = $10). Now figure out how many gallons you have left in your car. If you car holds 13 gallons, 1/4 of that is 3.25 gallons.
It depends how much your gas costs. If gas costs $3/gallon: (27 miles / 1 gallon) * (1 gallon / $3) = 9 miles/dollar.
How much gas is 5 hours of driving? ›
Driving 5 hours at 55 miles/hour, you will go (5 hours)(55 miles/hour)= 275 miles. AT 1/22 gallon per mile that will require 275/22= 12.5 gallons of gas.
How big is a gallon of gas? ›
The US liquid gallon (frequently called simply "gallon") is legally defined as 231 cubic inches, which is exactly 3.785411784 litres.
What do gas stations make the most money on? ›
Station owners make most of their profits in their stores, on sales of food and drinks, as well as alcohol where sales are legal. “The idea is to have a very competitive gas price, and when they go in the store, you can make money off that transaction,” Lenard said.
What day of the week is gas the cheapest? ›
Buy Gas on Monday or Tuesday
Be strategic about the days you fill up at the pump. “For gas, Mondays and Tuesdays tend to be the cheapest days to fill up your tank as demand is lower at the beginning of the week,” Anderson said.
Why is gas so high? ›
An isolated market and a special fuel blend
California requires a special blend of gasoline that reduces pollution — and costs more money. “California also has seen a drop of 66% in the amount of refineries in operation from where we were 40 years ago,” said Patrick De Haan, head of petroleum analysis for GasBuddy.
Where in the US is gas $10 a gallon? ›
A gas station in Mendocino, Northern California, is now charging nearly $10 a gallon. According to GasBuddy, it's the most expensive gas in the US.
How many cents per gallon of gas do you pay to the federal government? ›
The United States federal excise tax on gasoline is 18.4 cents per gallon and 24.4 cents per gallon for diesel fuel.
Why is gas over $4 a gallon? ›
The largest portion of the price increase can be attributed to the process of refining crude oil into fuel. While crude prices are up 12% this year, wholesale gasoline prices are up 28%.
