Released: August 10, 2008

Where your gas dollar goes

Source: Paul Adams, Baltimore Sun (Free Registration)

Wondering how all that extra money you’re spending on gasoline is split up among government taxes, refinery production and corporate marketing, among other things?

It’s not going to refiners, who have seen their margins drop as they scramble to turn more oil into gas. It’s not going to corner gas stations, many of whom say they are being forced out of business by falling profits. And it’s not going to the federal government, which is seeing its gas tax revenue slide as people drive less to save money.

“It’s the guys who own the oil being pumped out of the ground, and overwhelmingly, it’s people in the Middle East,” said Lester Lave, an energy expert and economist at Carnegie Mellon University.

Based on June figures, crude oil accounted for 74 percent of the price of a gallon of gas, which at that time averaged $4.05 nationwide, the Energy Information Administration reports. (The agency’s June figures are the most recent available.) At that price, gas would still cost $3.03 per gallon if you eliminated all costs for taxes (39.9 cents), distribution and marketing (27.7 cents), and refining (34.6 cents).

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