Over the past year, Americans have noticed gas prices rising. The rise in prices affects citizens from coast to coast.
According to AAA (American Automotive Association), the current average $/gal (dollar per gallon) in Illinois is $3.563. Currently it is very similar to the national average. In Illinois, the city with the highest $/gal average is Chicago, which is about $3.973. Considering it is the most populated city in Illinois, it is reasonable to have the highest average. On the other hand, Decatur with an average of $3.231 is the cheapest amount for gas right now in Illinois. (https://gasprices.aaa.com/?state=IL)
But why are these prices so high compared to a few years ago? According to the U.S. Department of Energy, there are many key reasons why.
- Cost of Crude Oil (54%): Crude oil is a liquid fossil fuel used for energy and various products, formed from ancient organic matter, such as ferns. The price of crude oil makes up 54% of expensive gas prices because it’s influenced by supply and demand, and the U.S. relying on imports.
- Taxes (16%): DOE states that,“In the United States taxes also play a critical role in determining the price of gas. Across America, the average gasoline tax is approximately $0.57 per gallon, however, the exact amount fluctuates from state to state.” (https://www.energy.gov/energysaver/gasoline-prices-explained)
- Distributing and Marketing (16%): Costs of gasoline distribution and marketing can vary among retailers. Some gas stations are owned and run by refineries, but others are independently owned, in which gasoline is bought from retailers and resealed at their own station.
- Refining Costs (14%): Refining costs are usually included in gasoline prices because oil must be refined into gasoline for consumer use. The U.S. has many refineries, but their capacity has not kept up with the nation’s oil demand, with no new refineries built since 1977.
Overall, gasoline prices can go up or down, sometimes even remain the same. In some states prices can be higher or lower than others. However it’s good to know how these prices can change and why they can change.
