Tag Archives: gas prices
Why Gas Costs as Much as It Does
posted by Auto Protection Specialist
If you’re an active driver, you’ve probably noticed that gas prices have been on the rise over the last couple of years. The days of filling up a tank for $30 are long gone! We always wondered why the gas costs as much as it does…specifically, how does the cost of every gallon of gasoline breakdown. After further research, we stumbled upon a neat chart by EIA, which we analyzed.
Gallon of Gas Breakdown:
- 11% – Taxes
- 11% – Distribution & Marketing
- 12% – Refining
- 66% – Crude Oil
The above breakdown suggests that if either of the components go up in costs overall price of gasoline increases. Most notably, price for each gallon of gasoline fluctuates significantly with the market rates of crude oil. This is hardly surprising as the price of crude accounts of almost 2/3 of the costs.
Lesson learned: Market prices of crude will continue to drive costs of gasoline.
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