It has been said that if you don’t like the price of gas, just wait until tomorrow, it will be different. Fortunately, for the the past few weeks the retail price of gasoline has been trending lower. This is nothing new, gasoline prices usually fall as winter approaches in anticipation of lower demand.
Retail gasoline prices usually vary wildly from state to state. According to GasBuddy.com, the most recent price per state ranges from $2.82 in Missouri to $4.08 in Hawaii. What exactly causes such a variation in price for a commodity that is essentially the same no matter where you purchase it? Since there are many factors that contribute to the price of a gallon of gasoline, the answer to this question is not so simple.
One of the more frequent explanations is state and federal taxes. The federal excise tax is easy, it is a flat rate of $00.18 nationwide. However, each state determines its own taxes and fees for gasoline, and there is simply no correlation between state gasoline taxes and the retail price of gasoline.
Transportation is one of those factors that contribute significantly to everything that we purchase, and gasoline is certainly no different. Crude oil must be transported to the refineries, usually by barge. Then, after the crude is refined into gasoline it must be transported to the retail locations, which is usually taken care of by truck. Also, some states are more refinery-friendly than others. So, as you can see, there are many factors that contribute to the price of gasoline, causing substantial variations in price from state to state.
Below is an interactive map and data visualization of gasoline prices and various taxes by state with a click-to-filter chart below for you to do your own analysis.