With gas prices headed for all-time highs this summer, I'm sure you'll feel better knowing exactly who is getting what every time you fill your tank.

by John O'Brien, Managing Editor

So the experts are telling us that gas prices this summer could reach record highs. I've got news for them. The guy at the Mobil station down the street where I get my gas has already broken the record. When I filled my tank the other day, the prices where $3.41, $3.34, and $3.26, for premium, plus, and regular, respectively.

I really had to do a double-take when I got out to swipe my card at the pump. It seemed like just the week before the prices were at least 30 cents cheaper. And just to soothe the feeling that I had just been gouged because I didn't shop around a little, I checked the prices at every gas station along the ride home and they were all basically the same, give or take a few cents. What a relief knowing I would have gotten screwed at any number of gas stations along my route.

According to Department of Energy (DOE), the primary factors at play in the price of gas include the cost of crude oil to refiners, refinery processing costs, marketing and distribution costs, and the retail station costs and taxes.

To break it down further and see exactly who is getting what slice of the pie, crude oil accounts for about 59 percent of the cost of a gallon of regular gasoline. That's OPEC to me and you.

Then comes federal and state governments via taxes. Within the national average, federal excise taxes runs 18.4 cents per gallon and state excise taxes average about 20 cents per gallon (some states levy additional state sales and other taxes). All tallied together, taxes comprise about 20 percent of the total price of a gallon of gas in the U.S.

Next up to the plate is distribution and marketing. I can see the distribution part of this component being somewhat of a vicious cycle. Crude oil is transported to refineries and refineries ship the gasoline to regional distribution points. Tanker trucks then take the gas/oil from these holding areas to retail sellers, such as gas stations. As the price for fuel goes up, it naturally costs more to transport it and those costs get passed on to the retailers, who pass it on to the consumers, some of whom are the folks transporting the stuff to begin with. You can probably see where I'm going with this so I'll stop here. Distribution and marketing account for 11 percent of the price of a gallon of gas.

And lastly, there are the refining costs, which make up about 10 percent of the price of a gallon of gasoline.

Although none of this will make you feel any better when you pull up to the pumps this summer, you can take some solace in knowing we have it better (for now) than some. Our man in the U.K., David Price, told me he's paying $2 for “a litre of petrol.” That translates to nearly $8 per gallon!

Oh, and by the way, a gallon of gas in Saudi Arabia is 45 cents.

Does this picture seem a tad bit skewed? Or is it just me?

John O'Brien can be reached at: jobrien@paperage.com

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