For most American motorists, the complexities of gasoline pricing are beyond easy comprehension. And efforts to learn more about the reasons for the current increases at the nation's gas pumps often lead to confusing and conflicting information.
One factor -- among many that have an impact on retail gasoline prices -- is the cost at refineries that are required to produce various types of gasoline to meet federal, state and local clean-air emissions standards. How much these standards affect retail prices is a matter of dispute, but it certainly appears to be one factor that could be leveled out by broader standards rather than city-by-city regulations.
While other market pressures -- crude-oil prices, refinery processing, marketing, distribution, taxes and retail profits -- are major considerations in determining the price motorists pay for gasoline, environmental programs also play a role.
The stop-and-start refining costs created by having to produce different types of gasoline to meet a variety of clean-air standards pushes gas prices up, says the Department of Energy -- but only creates "minimal impacts" on retail prices, according to the U.S. Environmental Protection Agency.
Which is it?
Even the Cato Institute has weighed in on the effect emission standards have on gas prices:
"Conservatives believe that environmental regulations have a lot to do with those low profits [in the gasoline refining market]. They're wrong. ... We'd love to blame big government and enviro-whackos for today's high gasoline prices (we do, after all, work for the Cato Institute). But telling fairy tales about the market does no one any favors. Prices are high because of global supply-and-demand factors, and Congress can do little about it."
There is one thing Congress could do: Create broader standards for emission controls so that refineries don't have to make so many kinds of gasoline. A more standardized product is bound to cost less in the long run.
And one more fact that seems to get buried in most news stories these days: U.S. gasoline prices at the pump may be the highest ever, but adjusted for inflation today's prices are still below records in the 1980s. The March 1981 pump price would be $3.03 a gallon today.
And gas prices in Europe are more than twice as high at the pump, even though some U.S. refineries are finding it's cheaper to import fuel from European refineries than to keep up with the cost of retooling refineries to meet emissions regs.
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