Tracking Gasoline Prices in America

Gasoline prices are down one month, after they were up the previous month, and then will shoot up the next. Many variables affect the price of gasoline. Tracking them is difficult making it practically impossible to predict. Plus, they're different depending on where you are. Other states and cities, and other countries can have very different gas prices from your local gas station.

Gasoline continues to be the nation’s bloodline. It is what keeps America on the go. Last year 140 billion gallons of gasoline and diesel fuel were pumped into just our personal cars alone, up 3.2 percent from the previous year.

Many forces impact the price of gas at the pump. The biggest portion of the cost of gas is crude oil, presently that is about 50 percent. This is determined by the world's oil-exporting nations, particularly the Organization of the Petroleum Exporting Countries (OPEC). The price of a barrel of oil is determined by how much these countries are producing. Price increases generally occur when the world crude-oil market tightens and lowers inventories. Another portion of the price covers the cost of the refining process. The cost of distribution and marketing also has to be included in the price. Federal and state excise taxes are in the price, too. All these factors vary and fluctuate. Natural disasters, weather, war and world events can step in to change the price of gasoline also.

According to a Motor and Equipment Manufacturers Association (MEMA) report, Americans drive more than 2.5 trillion miles per year in automobiles, light trucks and sport-utility vehicles (SUVs). With SUVs continually growing in popularity we are only getting more dependent on gasoline. A severe gas shortage would practically cripple the country. This high demand usually translates into higher gasoline prices. According to the Department of Energy, the United States consumes an average of 20 million barrels of oil daily, Of that, about 45 percent is used for motor gasoline or something like 178 million gallons is consumed every day.

The time of year can drive gasoline prices to go up. Typically, when lots of people go on vacation during the summer, the demand for gas spikes. In some years (like in 2004), prices continued to rise past the end of the summer travel season for a variety of reasons, including several hurricanes and an increase in the price of crude oil. Also, growing demand can sometimes outpace refinery capacity. In the spring, refineries perform maintenance, which slows or stops production. Oil refineries are usually back to full capacity by the end of May. So again, the time of year affects the price of gasoline. Oil companies like Triple Diamond Energy Corporation follow a production schedule that adheres to industry standards.