Gas: Everyone gets it, but not the price
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IDAHO FALLS — Idahoans have seen a sharp rise in gas prices over the last few months, but experts say the prices are typical for this time of the year.
The national average cost of regular gas dropped 10 cents in July. But in Idaho, gas continued to remain high at 27 cents above the national average, according to AAA’s most recent reports.
In Idaho Falls the average cost of gas in July was $2.90.
Despite the apparently high price, state experts say the cost of gas in Idaho isn’t remarkably different than it has been in previous years. Idaho gas prices are generally higher than national averages. Idaho recently lowered in price, and it is now just beginning to normalize with previous averages.
“Idaho is historically high, usually in the top 10 highest,” said Idaho Deputy Attorney General Brett DeLange, who serves as chief of the Idaho Attorney General’s Consumer Protection Division. “This is not unusual what we are seeing right now”.
Idaho, along with Nevada and West Coast states like California, typically have some of the nation’s highest gas prices. Part of this is due to location.
“Idaho has less access to product when there is a tight squeeze than other states,” AAA spokesman Dave Carlson said.
Idaho has one pipeline coming from Utah in southern Idaho that allows product to come into the state. This isolation contributes to keeping gas prices in Idaho higher than the national average.
“You can expect prices to come down slower in Idaho due to its isolation,” Carlson said.
The shortage of supply in Idaho causes suppliers to pay more for the product, a cost that is passed to consumers at the pump.
Gas prices rose quickly because two refineries shut down in California in February. Idaho doesn’t have a refinery or oil fields, so as demand grows Idaho must get gasoline from other places. Idaho has a high demand for gasoline, but has low supply and currently no way to change that.
During the months it took to get California refineries up and running, Idaho and Utah had to share product with Nevada. This helped Idaho’s gas prices normalize.
“Most people in Idaho forget that in January (2015) Idaho’s gas prices were some of the lowest in the nation at 30 cents to 40 cents below the national average,” said Carlson.
A variety of factors contribute to the price of gas. About 43 percent of the total price for gasoline comes from crude oil prices. And Idaho tax, which is set at 30 cents per gallon, is about 11 percent of the price, which is average for the nation. The Gem State raised its gas sales tax in July as part of its road-funding plan.
Consumers have little direct control over taxes and the price of crude oil, but they can influence the retail price at the pump. The retail cost makes up about 40 percent of the final price of gas, the attorney general’s office said.
“Consumers effectively can go the lowest price place, and the higher ones will lower the price,” said DeLange. “Vote with your wallet.”
The local gas station owners contacted by EastIdahoNews.com declined to comment on how they set their prices.
For more on the breakdown on the price of gas, watch the video below.