- Gas prices can differ by up to $1.90 per gallon between the most and least expensive states.
- The EIA identifies five primary factors: crude oil costs, refining capacity, state taxes, distribution logistics, and local regulations.
- State fuel taxes alone account for a $0.60 per gallon difference between the highest-tax and lowest-tax states.
- The West Coast consistently pays $0.50–$1.00 more per gallon than the Gulf Coast due to limited refining and stricter fuel standards.
01 Regional Price Differences
The EIA tracks gasoline prices across five Petroleum Administration for Defense Districts (PADDs) and reports significant, persistent price differences between regions. The West Coast (PADD 5) consistently has the highest prices in the nation, while the Gulf Coast (PADD 3) consistently has the lowest.
EIA, Weekly Retail Gasoline Prices by PADD region, 2020–2025| Region (PADD) | Avg Regular Price (2024) | Difference vs National Avg |
|---|---|---|
| Gulf Coast (PADD 3) | $2.95 | −$0.43 |
| Midwest (PADD 2) | $3.18 | −$0.20 |
| East Coast (PADD 1) | $3.35 | −$0.03 |
| Rocky Mountain (PADD 4) | $3.42 | +$0.04 |
| West Coast (PADD 5) | $4.38 | +$1.00 |
| U.S. Average | $3.38 | — |
The $1.43 spread between the Gulf Coast and West Coast averages represents one of the most consistent regional price gaps in U.S. energy markets. This gap has persisted for over two decades and widened since 2015 as California implemented additional fuel regulations.
EIA, PADD regional gasoline price data, 2000–2025; EIA, "Factors Affecting Gasoline Prices"02 State Tax Variation
State gasoline taxes are the most visible factor driving regional price differences. As of January 2025, state excise taxes on gasoline range from $0.09 per gallon in Alaska to $0.69 per gallon in California. When combined with the federal excise tax of $0.184 per gallon, total fuel tax varies by more than $0.60 per gallon between states.
FHWA, "State Motor-Fuel Tax Rates," January 2025; 26 U.S.C. §4081 (federal rate)| State | State Gas Tax | Total w/ Federal | Rank |
|---|---|---|---|
| California | $0.690 | $0.874 | 1 (highest) |
| Illinois | $0.668 | $0.852 | 2 |
| Pennsylvania | $0.587 | $0.771 | 3 |
| Texas | $0.200 | $0.384 | 44 |
| Mississippi | $0.184 | $0.368 | 49 |
| Alaska | $0.090 | $0.274 | 50 (lowest) |
For a driver using 500 gallons per year, the difference between California's total tax burden ($0.874/gallon) and Alaska's ($0.274/gallon) translates to $300 per year in taxes alone. Several states also apply sales taxes on top of excise taxes, further widening the gap.
Calculated: (0.874 − 0.274) × 500 = $300. FHWA state tax data.03 Refining and Supply
The Gulf Coast region (Texas, Louisiana) hosts roughly 50% of total U.S. refining capacity, giving that region a structural cost advantage. Gasoline produced in Gulf Coast refineries can reach local stations with minimal transportation costs. By contrast, regions that depend on imported gasoline—either from other U.S. regions or from overseas—face higher distribution costs built into the retail price.
EIA, Refinery Capacity Report, January 2025; EIA, PADD 3 refining statisticsThe West Coast faces a particularly constrained supply situation. California's refineries produce a specialized fuel blend (California Reformulated Gasoline) that cannot easily be supplemented by imports from other regions. When a West Coast refinery goes offline for maintenance or unplanned outages, prices can spike dramatically because alternative supply is limited.
EIA, "Factors Affecting Gasoline Prices: Refinery Operations"; California Air Resources Board, CaRFG specifications04 Environmental Regulations
Some states require specialized fuel blends that cost more to produce. California’s reformulated gasoline (CaRFG) standards are the most stringent in the nation, adding an estimated $0.10–$0.20 per gallon in refining costs compared to conventional gasoline. California also operates a cap-and-trade carbon market that adds approximately $0.15–$0.25 per gallon to fuel costs through carbon allowance prices.
California Air Resources Board, CaRFG program; California Cap-and-Trade Program, fuel cost impacts estimated by California Energy CommissionBeyond California, several other states and metropolitan areas require summer-blend reformulated gasoline under federal Clean Air Act provisions. The EIA identifies at least 15 distinct gasoline blends required across different parts of the country during summer months, which fragments the supply chain and can contribute to regional price spikes.
EIA, "Factors Affecting Gasoline Prices: Refinery Operations and Gasoline Specifications"; EPA, Reformulated Gasoline (RFG) program| Regulation | Region Affected | Estimated Price Impact |
|---|---|---|
| CaRFG (reformulated gasoline) | California | +$0.10–$0.20/gal |
| Cap-and-trade carbon costs | California, Washington | +$0.15–$0.25/gal |
| Federal RFG requirements | Major metro areas (17 states) | +$0.03–$0.08/gal |
| Low carbon fuel standard | California, Oregon | +$0.05–$0.15/gal |
Estimate your vehicle's driving cost using official EPA fuel economy data.
Use the Calculator05 Distribution and Geography
The physical distance from refineries to retail stations affects prices. The Gulf Coast’s extensive pipeline network can move gasoline cheaply to the East Coast and Midwest via major trunk lines. The Rocky Mountain region, however, is served by fewer pipelines and must rely more heavily on truck transport, which costs $0.05–$0.15 per gallon more than pipeline delivery.
EIA, "Factors Affecting Gasoline Prices: Distribution and Marketing"; Colonial Pipeline Company capacity dataHawaii, as an island state entirely dependent on imported petroleum, consistently has among the highest gasoline prices in the nation. Alaska faces similar logistical challenges despite being a major oil producer, because it lacks sufficient local refining capacity and must import refined gasoline products.
EIA, State Energy Data System; EIA, Weekly Retail Gasoline Prices by state, 2024Seasonal factors also interact with geography. The Midwest experiences more pronounced seasonal price swings than other regions because its refineries switch between winter and summer fuel blends on a tight schedule. If spring maintenance runs long or unexpected demand spikes occur, Midwest prices can temporarily exceed even West Coast levels.
EIA, "Today in Energy": Midwest gasoline price volatility analyses, 2019–202406 Data Sources
- EIA: Weekly Retail Gasoline and Diesel Prices, by PADD region. eia.gov
- EIA: "Factors Affecting Gasoline Prices." eia.gov
- FHWA: State Motor-Fuel Tax Rates, January 2025. fhwa.dot.gov
- EIA: U.S. Refinery Capacity Report, January 2025. eia.gov