DES MOINES, Iowa (AP) 鈥� The near-daily changes in U.S. gas prices are dizzying for drivers, who are left feeling by the highest fuel costs since 2022.
With the pushing up , the U.S. average for a gallon of gas , according to AAA. The uncertainty at the pump is trickling down from a massive, volatile that鈥檚 making it hard for gas stations to keep up.
Oil prices when U.S. markets opened Thursday following President Donald Trump鈥檚 promising to in the coming weeks. He .
U.S. drivers have spent the past month gaming out when to fill up or hunting for deals as gas prices can change from one day to the next, or from one nearby station to another.
Lonnie McQuirter, director of operations at 36 Lyn Refuel Station in south Minneapolis, said wholesale fuel prices are going up, sometimes multiple times a day, and are the main reason he鈥檚 had to charge more for gas than a month ago.
About a mile (1.6 kilometers) off Interstate 35, the neighborhood convenience store posted $3.399 a gallon for regular gas on Thursday, which is about 20 cents lower than the metro average, according to AAA.
鈥淲e price based on what we鈥檙e able to buy fuel at, and how well we can operate,鈥� McQuirter said. He declined to speculate about his competitors, saying, 鈥淭hey鈥檝e got different economics.鈥�
McQuirter said his margins have gotten much tighter. He鈥檚 also facing higher credit card fees and rising costs to maintain pumps. Still, in times like these, with consumers 鈥渟creaming for help,鈥� McQuirter said small operators like him act on emotion more than greed.
鈥淲e鈥檙e in our stores every day looking our customers in the eye,鈥� he said. 鈥淚t really takes a toll when people are having to cut back on certain things in order to afford to live.鈥�
What factors into gas prices?
A lot of it is outside the gas retailer鈥檚 control. Roughly half the price at the pump pays for the cost of crude oil, the main ingredient in gasoline, according to the U.S. Energy Information Administration. About 20% goes to refiners who turn crude into gas.
Those costs have risen as crude oil prices jumped in response to the war and in the . Gas retailers are adjusting the price at the pump to account for the higher price they just paid for their next shipment of gasoline.
Taxes 鈥� 鈥� account for nearly 20% of the price, while about 10% is left for retailers, who still have to pay for transportation, labor and other expenses.
Retailers’ markup has averaged about 38 cents a gallon over the past five years, according to the convenience store trade group NACS, citing data from research firm OPIS. After expenses, stations may keep roughly 15 cents per gallon, said Jeff Lenard, a vice president at NACS.
鈥淪ome make more, some make less,鈥� Lenard said.
Patrick De Haan, head of petroleum analysis at GasBuddy, compared it to a homeowner鈥檚 role in setting their sale price.
鈥淚f I was selling a house today, I鈥檇 be beholden to whatever the housing market is,鈥� De Haan said. 鈥淭hat鈥檚 the same for gas station owners. Whatever the price of oil and gasoline are, they are a price taker, not maker.鈥�
Why might prices differ from one gas station to the next?
Although the national average just passed $4 a gallon, the price that drivers pay varies widely by state, city and station.
Taxes alone can create large gaps. California’s gas taxes and fees totaled about 71 cents per gallon last year, compared with roughly 9 cents in Alaska.
Distance from refineries, the type of retailer, how much volume the location goes through and whether there are other fuel options nearby also play a role.
Gas stations near competitors may choose to price gasoline competitively on large outdoor signs to attract drivers, hoping they’ll come inside and buy higher-margin items, said Neal Walters, a partner focused on energy at the global management consulting firm Kearney.
鈥淚t鈥檚 one of the only retail locations where you don鈥檛 have to go into the store to find out what you鈥檙e paying,鈥� Walters said.
Who benefits from rising prices?
While U.S. retailers sell hundreds of millions of gallons of gas a day nationwide, they typically won’t see large gains when prices rise.
鈥淭he margins shrink when prices go up because it鈥檚 harder for them to pass along the increases as quickly as they themselves get them,鈥� De Haan of GasBuddy said.
When oil prices start to fall, retailers may recover some of those losses, particularly if there鈥檚 uncertainty about future supply costs. Prices can rocket up but tend to drift down like a falling feather, said Garrett Golding, assistant vice president for energy programs at the Federal Reserve Bank of Dallas.
Higher gas prices can also hurt sales inside the gas stations, if customers who are being squeezed at the pump spend less on other things.
鈥淪o it鈥檚 not always the case that higher prices mean the service station owners are actually doing better,鈥� Golding said.
Most profits in the oil and gas supply chain are made upstream, he said, by companies that extract and refine crude oil. Still, Golding said they aren’t necessarily celebrating; at some point, a significant spike in prices could hurt demand.
鈥淚t may be a good stretch of days or weeks for them,鈥� he said, 鈥渂ut they鈥檙e also cautious of what it could portend.鈥�
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