Oil prices are perhaps the most well-known factor impacting gasoline prices.

Understanding the factors that impact petrol/gasoline costs can help us make better choices about consumption, especially with fossil fuels remaining our primary energy source

Gasoline prices can be unpredictable, fluctuating from day to day and even hour to hour. While it may seem like the cost of gasoline is arbitrary, there are actually several factors that impact how much you pay at the pump. In this article, we will explore the different factors that affect gasoline prices, including oil prices, refining costs, distribution costs, taxes, and more.

Oil Prices

Oil prices are perhaps the most well-known factor impacting gasoline prices. This is because gasoline is made from crude oil. As the price of crude oil increases or decreases, so does the cost of producing gasoline.

The price of crude oil is determined by a variety of supply and demand factors. These include global economic growth, political events, production decisions made by OPEC (the Organization of Petroleum Exporting Countries), and more. When demand for oil outpaces its supply, oil prices increase. This can be due to a variety of reasons such as geopolitical tensions or natural disasters.