There are five main things that determine how much gas costs at the pump. When the amount of crude oil on the world market goes down, prices usually go up. Also, gas prices go up when demand is higher than what refineries can handle.
Crude oil suppliers are the first thing that affects the price of gas at your local station. This is about 59 percent of the price of gas, and it is set by the countries that export oil, especially OPEC, the Organization of Petroleum Exporting Countries. The price of a barrel of oil is based on how much crude oil each country makes.
The cost of refining crude oil is the next thing that affects the price of gas. This is about 10% of the total price of a gallon of gas.
The third factor is the cost of getting the crude oil to a refinery, the refined gas to a distribution point, and then to your local gas station. If you buy a brand-name gas, the price you pay depends on how much the company spends on advertising.
marketing The price of a product from a certain brand will also include the or brand. This is worth about 11% of the total cost.
The fourth part of the price of gas is federal and local taxes, which make up about 20% of the total price. State, local, and city taxes vary, which is one reason why gas prices can be different in different parts of the country.
The fifth thing to think about is the markup at the gas station near you. Obviously, the gas station near you is a business that needs to make money and pay its employees. So you know that every gallon of gas they sell makes them money. You might be surprised to learn, though, that the amount is usually less than 10 cents per gallon and can be as low as a penny. Some states do have laws about station markup and require a minimum percentage markup to protect small stations from being put out of business by bigger companies.
who might try to beat them.
