Breaking down higher gas prices in the Phoenix area - FOX 10 News Phoenix
Breaking down higher gas prices in the Phoenix area
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PHOENIX - The Phoenix area is no stranger to high gas prices, and the numbers continue to increase in the Valley with an average of $4.63, according to GasBuddy.
Experts say gas stations are trying to get rid of the winter blend and bring in the summer blend.
Marcus Jackson was filling up his tank in Phoenix on April 10 and said "I think gas prices are getting a little bit too high out here."
Lunyching Thiyang, also getting gas, agrees.
"I don't know why, but it seems like every other month it goes down, and then it jumps back up," Thiyang said.
Robert Donnellan, who works for IGEN, a tax compliance agency, spent 36 years in the oil industry as a tax director and explains what's behind the almost $5 per gallon.
"The cost of crude oil today, I think was like $85/$86 on average, which would give you a built-in cost of probably $2.04 a gallon just for the crude oil. Then when you go to the refineries and the refineries have to refine that product. It's generally anywhere between 50 and 70 cents a gallon to refine it, to make the gasoline that we use," he explained.
Donnellan says then you factor in all the jurisdictions, like different types of government agencies and environmental agencies.
"In Arizona you've got a gasoline tax of 18 cents a gallon. You've got federal tax which is nationwide at 18.40 a gallon, and then you got an underground storage tax which is imposed by the environmental agency in Arizona," Donnellan said.
That comes out to a penny a gallon, and then you've got other federal taxes which equate to around a penny a gallon.
"On a state by state basis, you're looking anywhere between 30 and 70 cents a gallon just in state excise taxes and fees," Donnellan explained.
Another factor is what the retail gas station's profit margin is, which Donnellan estimates is about 14 cents a gallon.
The cost of transporting gasoline, he says, and the cost of additives that gas stations add also contribute to the cost of gas.
"It's a little stressful, but it's something we have to do, but also getting the prices down is something we need to do," says Marcus Jackson, who was getting gas on April 10.
Experts say gas prices are expected to come down in June, July and August.