Why Gas Prices Differ by State: Taxes, Blends, Distance

Gasoline prices differ by state for four reasons: state taxes, which ranged from 8.95 cents a gallon in Alaska to 73.64 cents in California on July 1, 2026; distance from refineries; special fuel blends required in some areas; and local competition. Taxes are the easiest part to see, but in the widest gaps they explain a minority of the difference.

In the week of October 19, 2026, the EIA's weekly survey put regular gasoline at $6.031 a gallon in California, $3.704 in Texas, and $4.284 for the United States as a whole. This page lays out the official state tax table, the regional supply map behind it, and a step-by-step breakdown of what separates one state's pump price from another's. If you want the general anatomy of a gallon first (crude, refining, distribution and marketing, taxes), read the gasoline price breakdown; this page picks up where that one stops, at the state line.

Five forces that set a state's pump price

Every gallon in every state starts from the same world crude market. A Texas refinery and a California refinery pay similar prices for similar barrels, adjusted for freight and quality. What differs is everything built on top of the crude cost. The EIA groups regional differences under five headings, and each one behaves differently:

The forces interact. A state with a high tax and an isolated supply system (California, Washington) sits at the top of the price table. A state with a low tax next to the refineries (Texas, Louisiana, Oklahoma) sits at the bottom. The states in between are often there because one force pulls up while another pulls down.

The official state gas tax table, July 2026

The EIA publishes a table of federal and state motor fuel taxes twice a year, using rates in effect at the start of January and July. The version below uses the July 1, 2026 rates (the table was updated in July 2026 and revised in August 2026), checked October 2026. The "other taxes and fees" column holds whatever each state adds to its headline excise: prepaid sales taxes, underground storage tank fees, inspection fees, environmental surcharges, and in some states a gross receipts tax converted to cents per gallon. The last column compares the total with January 1, 2025, so you can see which states have moved.

Cents per gallon of gasoline, rates in effect July 1, 2026 (EIA, Federal and State Motor Fuels Taxes, checked October 22, 2026). Federal tax of 18.4 cents added in the sixth column. Excludes county and local taxes and taxes based on gross or net receipts, which EIA notes are outside the table. Rounded to two decimals; components may not sum exactly.

A few patterns are worth pulling out of the 51 rows. The simple average across the 50 states and the District of Columbia is 33.76 cents a gallon, and the median state (Alabama) charges 31.00 cents. Twenty-seven jurisdictions changed their total between January 2025 and July 2026, almost all upward. The largest increases were Indiana (up 12.00 cents), Washington (up 7.35 cents), Mississippi (up 6.00 cents), and Michigan and Illinois (each up 5.60 cents). Six fell, none by more than Kentucky's 1.40 cents.

The headline excise rate is not the whole story. New Jersey's excise tax is only 10.5 cents, among the lowest in the country, but its petroleum products gross receipts tax adds 38.65 cents, which lifts the state total to 49.15 cents. New York's 8-cent excise is the lowest excise outside Alaska, yet its Petroleum Business Tax and testing and spill fees take the listed total to 24.18 cents, before the state and local sales taxes that the EIA notes are charged on top. Comparing states by the excise column alone will mislead you.

Why some state taxes move with the price

Most state excise taxes are fixed cents per gallon, changed by legislation or by an annual inflation index. A growing group of states also charges a percentage tax on fuel, collected in advance at a per-gallon rate that the state resets as prices change. Indiana is the clearest example in the 2026 data. Its Gasoline Use Tax is the equivalent of the state's 7 percent sales tax, recalculated monthly, and it was 26.5 cents a gallon as of June 1, 2026. That single component explains most of Indiana's 12-cent rise. Illinois collects a prepaid sales tax of 21 cents on ordinary gasoline, and California a prepaid 8 cents toward its 2.25 percent state sales tax on gasoline. When pump prices jump, these states collect more per gallon automatically, which slightly widens their gap over fixed-rate states.

Temporary tax holidays push the other way. The EIA notes record that Kentucky's governor cut the state's motor fuel tax by 10 cents a gallon by executive order in May 2026, a cut that expired on June 30, 2026. A holiday like that briefly narrows a state's gap, and its expiry shows up as a sudden jump at the pump on the first day the full rate returns.

Where the gasoline comes from: the PADD map

Federal data group the country into five Petroleum Administration for Defense Districts, or PADDs, and the supply picture is lopsided. On January 1, 2026, the EIA counted 18,160,493 barrels per calendar day of operable atmospheric crude distillation capacity in the United States. More than half sat in one district:

Capacity: EIA, Number and Capacity of Petroleum Refineries, operable atmospheric crude oil distillation capacity on January 1. Prices: EIA weekly and annual retail regular gasoline, dollars per gallon including taxes. All checked October 22, 2026. Shares are PetroEyes arithmetic.

The ranking of prices follows the supply map closely. The Gulf Coast, with more than half the country's refining capacity, was the cheapest district in 2025 and again in October 2026. The West Coast, which refines for itself with little pipeline connection to the Gulf, was the most expensive by a wide margin: $1.417 a gallon above the Gulf Coast on the 2025 average and $1.773 above it in the October 19 week. The Rocky Mountain district, small and landlocked, swings above the national average when its few refineries or its inbound pipelines are constrained.

For the boundaries of each district and the sub-districts inside PADD 1, see the PADD districts explainer. The point here is narrower: a state's position on this map sets its transport cost and how easily it can borrow gasoline from a neighbor when something breaks.

States with no refineries are not automatically expensive

Florida, Arizona and Oregon each had zero operable refining capacity on January 1, 2026. Their outcomes differ because of how the gasoline arrives. Florida is supplied mostly by water from Gulf Coast refineries, a short and cheap tanker and barge haul, and its September 2026 average for regular ($4.115) was below the national average ($4.355) despite a state tax total of 40.10 cents. Arizona and Oregon depend on long pipelines and West Coast or Gulf refineries, and they inherit their suppliers' prices and outages. Being near a refinery helps; being on a cheap supply route can matter as much.

Special blends: why gasoline cannot always cross the state line

Federal law allows, and in some cases requires, gasoline sold in certain areas to meet tighter specifications than ordinary conventional gasoline. The EIA says about one-third of U.S. gasoline is reformulated gasoline (RFG), required in areas with ozone problems; a separate 2026 EIA article quotes the EPA's figure of about 25 percent of sales. Either way, a large share of the market cannot simply use the cheapest gallon available. In the EIA weekly data for October 19, 2026, all-grades gasoline in reformulated areas averaged $4.822 a gallon against $4.221 in conventional areas, a 60-cent gap that mixes the blend cost with the fact that RFG areas are mostly large, high-cost metro regions.

California goes further than the federal program. The California Air Resources Board sets its own gasoline standard, with a summer vapor pressure limit of 7.0 pounds per square inch against the federal 9.0, and relatively few refineries outside the state make it. When a California refinery stops, the replacement fuel has to come from a refinery able to meet that specification, often in Asia or on the Gulf Coast, by tanker. The EIA's regional price explainer names the unique blend, the stricter reformulation program and the state tax as the three reasons California prices are higher and more variable than elsewhere. The seasonal side of these rules, and the national waivers the EPA used in 2026, are covered in summer vs winter gasoline.

Other states run smaller "boutique" programs: Arizona's Cleaner Burning Gasoline in parts of the state, and lower-volatility summer standards in specific metro areas such as Reno, Portland, Salt Lake City and Beaumont-Port Arthur, listed on the EPA's Reid vapor pressure page. Each one fences off a small market that can only be supplied by refiners willing to make that grade.

Worked example: decomposing the California and Texas gap

Both states publish weekly EIA prices, and they sit at opposite ends of the price table, which makes them the cleanest pair to take apart. All inputs below are EIA figures checked October 22, 2026; the arithmetic is ours.

So $0.54 of the $2.33 gap is listed state tax, and $1.79 is something else. That remainder is not all refinery profit. It contains:

• Taxes the table leaves out. California's state sales tax on gasoline is 2.25 percent; the 8 cents in the table is only the prepayment. At a $6 pump price the final liability runs higher, roughly 12 to 14 cents depending on which taxes sit in the base, and district sales taxes add more.
• Program compliance costs. The EIA table notes that California gasoline is also subject to costs from the Low Carbon Fuel Standard and the cap-and-trade program. These are paid upstream and passed through in the price, so they appear in the remainder, not in the tax column. The EIA does not put a cents-per-gallon figure on them in the tax table, and this page does not either.
• The cost of the blend. California reformulated gasoline is more expensive to make than Texas conventional gasoline, especially in the summer grade.
• Refining and supply margins. A smaller, isolated refining system earns wider margins when it is tight, and California's has shrunk.
• Distribution and retail. Land, labor and station operating costs differ between Los Angeles and Houston.

The size of that non-tax remainder has grown. The table below repeats the subtraction on annual averages, using the January 2025 tax rates for 2025 and the July 2026 rates for the latest month.

In 2025 the listed state tax difference was 49.82 cents (69.82 against 20.00 on the January 2025 table), about 28 percent of the $1.750 annual gap, leaving roughly $1.25 outside the tax column. By October 2026 the tax difference had grown only to 53.64 cents, while the total gap had widened to $2.33. Over the same years California's operable refining capacity fell from 1,748,171 barrels per calendar day on January 1, 2021 to 1,499,171 on January 1, 2026, a drop of 249,000 barrels a day or about 14 percent, according to the EIA capacity series. The 2026 figure already reflects the closure of Phillips 66's 138,700 barrel-a-day Los Angeles refinery in October 2025, and it still counts Valero's 145,000 barrel-a-day Benicia refinery, which the EIA says has since ceased refining and dropped out of its monthly capacity estimates from March 2026. The correlation does not prove the cause by itself, but a state that makes its own special gasoline with fewer refineries has less slack when one of them falters.

Three more pairs, three different answers

Repeating the method on other pairs shows that the dominant cause changes from one comparison to the next. Using September 2026 monthly averages and July 2026 tax rates:

The Chicago row uses EIA city prices and the Illinois state rate; Cook County and the City of Chicago add their own per-gallon taxes, which are not in the EIA state table, so a good part of the 32-cent remainder is still tax. The Florida row shows the opposite of the West Coast: a state with no refineries of its own, but a short, cheap supply line from the Gulf, pays only about 12 cents a gallon more than Texas once tax is removed.

How to run this comparison for your own state

1. Pick comparable prices. Use the same week or month for both places and the same grade (regular). The EIA publishes weekly state prices only for nine states (California, Colorado, Florida, Massachusetts, Minnesota, New York, Ohio, Texas, Washington) plus ten cities and the PADD regions; the city fuel price map on our gas prices page lists which official source covers each place and how often.
2. Subtract the listed state taxes. Use the total state column from the table above, not the excise column. Ignore the federal tax; it cancels.
3. Note the local layer.If either place charges county, city or sales taxes on fuel, the EIA table excludes them. Check the state revenue department for the local rate before calling the remainder "margin".
4. Place both states on the PADD map. A remainder of more than about 50 cents between two states in different districts usually points to supply geography or blend rules rather than station pricing.
5. Check the calendar. In spring and early fall, blend switch dates differ by region, and a refinery outage in one district can open a gap for several weeks that later closes on its own.

Common mistakes when comparing states

• Reading the excise rate as the whole tax. New Jersey's 10.5-cent excise and New York's 8-cent excise both understate what those states collect per gallon.
• Assuming tax explains the ranking. Illinois has the second-highest state total, yet in September 2026 the EIA's Midwest average ($4.166) was below the national average ($4.355), because the Midwest holds nearly a quarter of the country's refining capacity.
• Comparing a city to a state. City prices carry city taxes and city costs. Compare city to city or state to state.
• Using an old tax table. Half the states changed their totals in the 18 months to July 2026. Many widely shared tables are a year or more out of date.
• Ignoring timing.A refinery outage can add tens of cents to one region for a few weeks. A single week's gap is a snapshot, not a structural fact; annual averages are better for structural comparisons.
• Treating station-to-station gaps as state gaps. Within one state, prices still vary with location, brand and competition. The forces on this page explain differences between regions, not between two stations on the same road.

What would narrow or widen the gaps

State gaps are not fixed. Three things in the current data are worth watching. First, refinery capacity on the West Coast: further closures would leave that district more dependent on tankers, while added pipeline or import capacity would do the opposite. The national capacity picture is tracked in our refinery operations hub. Second, tax indexation: states that index their excise to inflation or collect a percentage tax will drift upward automatically, while fixed rates like Texas's 20 cents erode in real terms. Third, federal fuel waivers: in 2026 the EPA used emergency waivers to allow a single national gasoline pool for part of the year and to bring winter-grade gasoline forward, which temporarily relaxed the blend barriers between regions. Waivers are temporary by law, and the barriers return when they lapse.

Crude oil itself, by contrast, does little to explain differences between states, because every region buys from the same world market. When crude rises, all states rise together. For how quickly that pass-through happens, and why prices seem to rise faster than they fall, see rockets and feathers in gasoline prices.

Questions readers ask about state gas prices

Data and sources, all checked October 22, 2026: U.S. Energy Information Administration (EIA), Federal and State Motor Fuels Taxes (rates in effect July 1, 2026, updated July 2026 and revised August 2026; January 1, 2025 sheet for the change column; notes on California, Indiana, Illinois, Kentucky, New Jersey and New York); EIA Today in Energy, February 21, 2025 (January 2025 rates cross-check); EIA weekly, monthly and annual retail regular gasoline prices by area; EIA Number and Capacity of Petroleum Refineries (operable atmospheric distillation capacity, January 1, 2021 to 2026); EIA Energy Explained, regional gasoline price differences; EIA Today in Energy, April 15, 2026 (CARB 7.0 psi limit, RFG share per EPA); EPA, Gasoline Reid Vapor Pressure (7.8 psi areas); EPA fuel waivers (2026 national waivers). Gap, share and remainder figures are PetroEyes arithmetic from those inputs.