(WSYR-TV) — Gas and rebate checks, the two topics that keep the Your Stories Team busy. A common question the YS Team receives centers around fluctuating prices and how gas prices are determined.
Two viewers recently contacted the YS team asking how can gas prices be substantially higher in one county compared to a neighboring county.
According to AAA, the county with the lowest average per gallon of regular gas is Cortland County. Drivers, there are spending $3.35. Neighboring Onondaga County is $3.69. If you live in Oswego County, you are paying an average of $3.80.
Patrick De Haan, who is the Head Petroleum Analyst for GasBuddy, said setting prices at the pump is a complicated formula, with complex factors.
He said the location of the service station is a major factor. Real estate costs, rent, property taxes, and competition all factor into pump prices.
All the industry experts the YS Team spoke with for this story pointed to transportation costs as another pricing factor.
Ed Jacobsen of the Northwoods Petroleum Museum in Wisconsin has been in the gas game for 65 years. Before running the museum, Jacobsen operated several service stations in the Chicago area. Jacobsen said the more miles a truck must haul fuel to a station, the more it will likely cost us at the pump.
Oswego County Administrator, Philip Church said in an email that more rural counties are usually higher.
“Differences in local taxes and optional temporary waivers can make a small difference, but supply distance has always been a large factor,” Church said in an email.
According to The U.S. Energy Information Administration:
Retail gasoline prices tend to be higher the farther the source of supply is from where gasoline is sold because transportation costs increase when the distance from the source of gasoline supply increases. These supply sources include refineries, ports, and pipeline and blending terminals.
When it comes to competition, the EIA posted on its website, “Gasoline station pump prices are often highest in locations with fewer gasoline stations.”
Jacobsen added there’s no definitive answer when it comes to fluctuating prices, but he too pointed to competition between stations as a major factor in setting prices.