Why are gas prices so different from State to State?

13 comments

1. While I’m sure some of it is distribution costs (costs more to ship things further), I think most of it is things like taxes and regulatory costs of doing business

2. Different states have different gas tax rates.

3. Because taxes are different from state to state.

4. California is drastically different because it mandates a different fuel blend for smog reduction. But not many refineries produce it.

5. Tax.

6. Not just state to state, street to street. The cost of sold gas will vary greatly depending on many factors such as the local competition, wages of those in the local area, local (especially if it’s close to a major traffic hub), etc.

7. Taxes, income, distance the gas has to be transported etc

8. [Different tax rates.](https://taxfoundation.org/state-gas-tax-rates-2021/)

   Different formulations of gasoline, due to different air quality regulations (California is especially strict), different climates (with different needs for [summer versus winter gasoline](https://www.gasbuddy.com/go/summer-blend-and-winter-blend-gasoline)), [different elevations](https://www.cpr.org/2022/01/04/colorado-gasoline-unleaded-octane-environmental-impact/), etc.

   Different distribution costs due to whether gasoline is refined locally or shipped in from other states, and whether it’s shipped by pipeline, ship, or truck.

   Different demand schedules due to how many drivers live in an area, their income, what types of vehicles they tend to drive, etc.

   [According to the AAA](https://gasprices.aaa.com/state-gas-price-averages/), gas is cheapest in Texas (with a strong local oil industry, and relatively low tax) and highest in Hawaii (where almost *everything* is expensive due to having to be transported across 2000+ miles of ocean).

9. Taxes, availability, Emission standards, etc.

10. 1. Presence of petroleum within the state.
    2. Presence of Oil refineries.
    3. Distance from 1+2, and Canadian petroleum.
    4. Demand.
    5. State gas taxes or lack thereoff.
    6. level of dependence on petroleum for electrical power production.

11. There are many factors.

    Distance from the refinery affects price. The farther it has to be shipped the more expensive it will be.

    Blend of gas affects the price. Some companies sell higher cost blends, and some States like California require more expensive blends by law for perceived ecological reasons.

    States set different tax rates on fuel. Even Counties and Cities can add taxes at times in some places.

    Volume of competition within a certain radius will affect price. The more competition the cheaper it will be,

12. Taxes play a part but it is mostly distribution costs and straight up supply and demand.

13. Different team rates, distribution costs, and each gas station will charge as much as the market will permit.