In this article, we are going to discuss the 10 states with the highest gas prices. If you want to check out our detailed analysis of the global oil and gas market, the reason why gas is cheaper in America in comparison to other developed countries, and the total refining capacity of the United States, head to 25 States With the Highest Gas Prices.
10. Idaho
Price of Gas per Gallon: $3.862
Exploration for crude oil in Idaho began in 1903, but despite promising geology in the state’s southeast and southwest, no commercial reserves were discovered or produced until the last decade. The whole of southern Idaho is dependent on a single pipeline from the Salt Lake City refineries for its gasoline supply, so with only one limited gas resource, sometimes the supply cannot respond as rapidly when demand increases.
9. Utah
Price of Gas per Gallon: $3.871
Utah produces a significant amount of crude oil, and its five refineries have the capacity to process 206,000 barrels of it everyday. However, a significant amount of this fuel is exported to other states on the West Coast, raising the prices also for the Utahns.
Also, while the Gulf State refineries transport most of their fuel by pipelines, refineries in the Beehive State transport their product primarily by road, which adds to the costs.
8. Illinois
Price of Gas per Gallon: $3.986
Illinoisans pay a total of $0.85 per gallon in the form of federal, state, and local taxes – the 2nd highest in America. Illinois is also among the few states that charge a sales tax on gasoline, adding it after the motor fuel tax is already applied.
7. Arizona
Price of Gas per Gallon: $4.135
There are no oil refineries in Arizona, so almost all of its gasoline is imported from California via the ‘West Line’, and Texas via the ‘East Line’. While the state’s gas demand has recently skyrocketed due to a population boom, the pipelines haven’t been adjusted to increase the supply accordingly.
The Grand Canyon State requires a particular oil blend of gasoline to meet air quality regulations, which results in more expensive gas.
6. Alaska
Price of Gas per Gallon: $4.363
At only 8 cents per gallon, Alaska is the State with the Lowest Gas Tax in the country. But it still has such high gas prices mainly because of its remoteness and low demand. And although gasoline is expensive all over The Last Frontier, the smaller communities that don’t have that much volume, particularly ones where the fuel has to be barged or flown in, always pay substantially more than Anchorage.
5. Oregon
Price of Gas per Gallon: $4.434
Not only does Oregon not produce any crude oil of its own, the state also has no oil refineries. This means that all of its fuel supply needs to be imported from other states, which adds to the costs. The Beaver State is also known for its strong environmental commitments, requiring nearly all gasoline sold to be a 10% ethanol blend, thus jacking up the prices.
4. Nevada
Price of Gas per Gallon: $4.636
The average gas price in the Silver State has increased by a significant 11.7% since a month ago, when it was $4.149. Like Oregon, a major factor contributing to Nevada’s high gas prices is the state’s limited domestic production, with the majority of its supply being imported from neighboring states like Utah and, primarily, California.
3. Washington
Price of Gas per Gallon: $4.666
Washington has one of the highest gas taxes in the country, at 49.4 cents per gallon. Those taxes are how the state has funded many recent highway projects. The Evergreen State’s new carbon cap program is also adding to the high gas prices for its consumers.
Washington lawmakers embarked in early 2012 to learn if charging drivers for the miles they travel could eventually replace taxing them on every gallon of fuel they buy. The concern then, and now, is that gas tax receipts are in a slow decline as passenger cars get more fuel efficient and electric vehicles become more prevalent.
Washington ranks among the top 5 states with the highest gas prices.
2. Hawaii
Price of Gas per Gallon: $4.742
Although Hawaii has no proved crude oil reserves or production, it does refine crude oil into petroleum products. The local Oahu refinery supplies much of Hawaii’s demand, but the crude oil to feed it has to be imported from other states or abroad, thus driving up the costs.
Another major reason for the high gas prices in the Aloha State is an antiquated law from the early 1920’s – the Jones Act. The act requires all goods shipped between U.S. ports to be transported by American vessels, and since the U.S. does not build enough ships anymore, it makes it more expensive to transport fuel from California and other mainland states to Hawaii.
Energy prices in Hawaii have skyrocketed after Russia’s invasion of Ukraine in 2022, which prompted Russian oil embargoes. Before the war, Russia provided about 25-30% of Hawaii’s oil.
1. California
Price of Gas per Gallon: $5.453
California is the state with the highest gas prices in U.S.A. A major factor behind this are the high local taxes, adding up to 87 cents per gallon to the price of gas in the Golden State – the highest in the country.
Moreover, since 1992, the state has required gas stations to sell a special gasoline blend that reduces smog, and that special blend also adds between 10-15 cents to the gas price. Another contributing factor to California’s high gas prices is the reliance on local production and nearby refineries, some of which were recently shuttered for maintenance.
California is also counted among the States with the Highest Natural Gas Prices in America.
Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below. You can also take a peek at 20 States with the Cheapest Weed in America and Alcohol Consumption by Country: 25 Countries with the Highest Alcohol Consumption per Capita.
