Tuesday, March 15, 2011

What's "IN" the Price of a Gallon of Regular Gasoline

When the price of crude oil rises, as it has been lately, we all see the effects at the gas station. But other costs also affect what we pay. The U.S. Energy Information Agency sponsors a website called Today in Energy. Last week it posted a webpage that shows the part played by the major components of the price of gasoline - crude oil prices, refining costs, distribution and marketing expenses, and taxes. As the site explains:
The portion of the gasoline price each of these components accounts for can vary significantly over time. Crude oil is typically the largest cost component of gasoline, and its share of the price of a gallon of gasoline was significantly higher in 2010 than it was, on average, over the 2000-2009 period.
When you look at the historical data (2000-2010) for crude oil costs, its percentage of the total we pay at the pump has varied from a low of 35% in May, 2001, to a high of 75.8 in July, 2008.

But why is there such variety in prices across the country at any given time? One of the reasons covered by the website is taxes. The federal tax on regular gas is 18.4 cents per gallon. Each state also taxes gasoline, from a low of 7.5 cents per gallon (Georgia) to a high of 37.5 cents here in Washington. That high and low is a bit misleading, however, because those figures include only the rates of "general application." Some states add other taxes, such as Iowa's 1 cent per gallon Environmental Protecton Charge or Virginia's 2% sales tax in areas covered by mass transit. Other states permit "local option taxes," such as Honolulu's 16.5 cents per gallon.

Energy is a major topic in our government and in our lives. Check out Today in Energy to keep abreast of the current issues. Here is a description of the website.

The Today in Energy website:

* Covers key energy issues and topics in a short-article, one-page format
* Includes a visual explanation — a chart (sometimes interactive), map, animation, or photo — to illustrate the point.
* Makes data series behind charts often available for download
* Is written in plain language for a broad audience
* Gives you a way to send feedback to EIA experts and analysts
* Contains archives so you can retrieve a favorite story.
* Enables you to subscribe to our RSS feed or email version so Today in Energy comes to your browser or inbox every weekday

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