Who sets gas prices?

So the question is “who controls gas prices”? The short answer is: No one person, company or government can really be said to set gas prices. But it is possible to break down some of the major factors that go into determining what a gallon of gas sells for. Let's take a look. The biggest, accounting for a bit more than half the price you pay, is the price of crude oil – the raw material from which gas is refined. Unfortunately, the price of that raw material has been on a tear for over a year now, bringing gas prices higher with it. West Texas Intermediate crude now trades for about $110 per barrel. A year ago, it was only $65 per barrel. In 2020, during the depths of the recession caused by COVID-19, WTI prices briefly turned negative because global oil demand fell so fast that oil storage facilities filled up with unwanted oil. Since then, global oil demand has come roaring back, but global oil output has been slower to recover from the cuts that OPEC and many energy companies implemented. The next biggest factor determining gas prices, according to the Department of Energy, is gas taxes – specifically, the state, local and federal taxes levied on fuel. The 18.4-cent-per-gallon federal tax on gas hasn't been increased in about three decades. Some states have actually cut or suspended their own gas taxes recently in an attempt to give motorists some relief. The remaining factors controlling gas prices are a mix of related costs: refining crude into gasoline and other fuels, transporting it to stations by pipeline and truck, and marketing it. For what it’s worth the pain at the pump is actually much worse in some other countries. To give you some perspective, residents of Hong Kong pay the highest international gas prices, with one gallon setting them back $10.97. At the other end of the spectrum, Venezuelans pay just $0.08 for a gallon of gas, the cheapest prices on the planet.