When you are paying $30 for the gas that is pumped into your tank then you are not just paying the pump station but you are paying to all those entities that have made this gas available for you. Means the money that you are paying is distributed among several groups which are linked together in the supply chain of gas. The media can sometimes make you to believe that the price of crude oil is the only factor that determines the gas prices, but this is not true as there are many factors that determine the gas prices in a country. All of these entities have to get their due share, no matter how expensive the gas may be.
According to the U.S. department of energy here we have given an approximation of distribution of each dollar you spend on gas: 
For Taxes: 21 cents
For Distribution and Marketing: 15 cents
For Refining: 17 cent
For Crude oil: 47 cents
(Source: DOE)
This was the average breakdown of gas prices as in Feb 2009.
Let me explain you these components in some more detail.
Amount spent on purchase of Crude oil – The biggest portion of the gas price goes to the crude-oil suppliers. The world’s oil-exporting nations, particularly the Organization of the Petroleum Exporting Countries (OPEC) determine them. The amount of crude oil produced by these countries determines the price of a barrel of oil. In 2004, crude-oil prices were almost around $35 per barrel (1 barrel = 42 gallons or 158.99 L). And, after Hurricane Katrina, some of the prices were doubled. In April 2008, crude-oil prices were almost around $104.74 per barrel. During the same month, the price of oil leads to a record price of almost $120 a barrel (Source: DOE).
Till May 16, prices had reached $117 per barrel (Source: Market Watch). On May 22, $135 per barrel price was reported in the markets in New York and London, and on July 11, oil hit the highest ever recorded price of $147 (source: Forbes, New York Sun). Analysts guessed that the increasing demand from countries like India and China has contributed to such a huge rise in price.
Sometimes the gas prices rises even when there is plenty of crude oil in the market. It depends on kind of oil available in market, either heavy or light and sweet or sour ,well these are the names given to different kinds of oil on the basis of there qualities. Light, sweet crude is easier and cheaper to refine, but its supplies are short. On the other hand the heavy, sour crude oil is abundant but its refining is very costly.
Amount spent on Oil Refining
The amount for refining of diesel fuel is much higher than the price spent on refining regular gasoline.
Amount spent on Distribution and marketing
The price of transportation charged for transporting Crude oil to refineries, and the price of gasoline shipment from the refineries to distribution points and after that to gas stations is included in the price charged from customers. The gas price also includes the money spent on marketing the brand of the oil company.
Amount spent on Taxes
18.4 cents per gallon is charged as federal excise taxes, and an average of 18.2 cents per gallon is charged as state excise taxes. There may be some other taxes also which are added to gas prices, such as applicable state sales taxes, gross receipts taxes, oil inspection fees, underground storage tank fees and other miscellaneous environmental fees. If all these taxes are added to the state excise taxes, we will get an average of 27.4 cents. It could have worse impact on gas prices, leading them to higher gas prices. Gas prices in Europe are far higher than in America due to much higher tax rates.
Amount charged by Gas Stations
It is obvious that a part of gas price charged from you also goes to the service stations. Service stations can add a few cents on to the price. But it is not determined by government that how much gas stations can add on to the price. Some customers blame service stations that they are charging higher prices and there is much difference between the original invoice of gas and the prices charged at gas stations. However, in some states markup laws have been enforced restricting stations from charging less than a certain percentage over invoice from the wholesaler. The main purpose of implementation of such laws is to give protection to the small, individually-owned gas stations so that they might not be driven out of business by large chains that can afford to slash prices at select locations.
Why Gas Prices vary from state to state?
There are many reasons due to which the gas prices also vary from state to state. The biggest factor that is very likely to affect the prices around the country is Taxes that might be different for different states. Moreover, the competition among local gas stations can also lower the gas prices. Distance of gas stations from the oil refineries can also have a great affect on prices, for example, stations closer to the Gulf of Mexico, have lower gas prices due to lower transportation costs because in that area many oil refineries are located. And some regional factors can also have an affect on gas prices.
Impact of Current Affairs on Gas Prices
Prices can also be raised due to world events, wars and weather. Anything that is capable of affecting any part of the process, from the moment the oil is drilled, through refining and distribution to your car would be able to result in a change in price. Military conflicts in those parts of the world which contribute lot in oil supplies could create a difficulty for oil companies to drill and ship crude oil from those countries. Hurricanes have made a lot of damage to the offshore drilling platforms, coastal refineries and shipping ports that receive oil tankers. The market might also be adversely affected if a tanker itself is lost or damaged, or its oil is leaked into the ocean.
The most recent increase in gas prices is due to several factors that include all of those that we have already listed above. Despite, a new reason for fluctuation in gas prices during the spring of 2007 has appeared: According to new legislation out of Washington more ethanol into transportation fuels shall be incorporated, and that would be enough to reduce daily oil imports by 1.5 million barrels till 2017. Between October 2007 and April 2008, ethanol-blended gas was between 4 and 12 percent more expensive than regular gas (source: McKay).
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{ 2 comments… read them below or add one }
………Interesting
There is a propagandists best told lie here somewhere! Until
Cracking” of oil into gasoline was discovered, half a bbl of oil was wasted ‘diesel fuel!” I call Bull Shiite! Diesel engines, especially Eurp Diesels are 40 % more efficent, and for half of my 50 years fuel buying experience, Diesel fuel was always half the price of gasoline! Suddenly, somewher in the 70’s Diesel went up in price to parity with gasoline, and now towards premium prices – without the benefit or need for expensive additives! I call Bull Shiite! Fraud! Liars and smell shyster logic rip-off of American folk and look for a schlock-meister explanation based in “secret science” or even voodoo from the oil barons! Fact is we are being milked again! Right up the brown spot! Hard and fast! with no lube at all! The nervy bastards!