What Determines the Pump Prices of Diesel Gas?


Quick Answer

Crude oil costs are the largest factor in retail diesel prices, accounting for 57 percent of diesel's price in 2014, according to the US Energy Information Administration. Other factors for diesel's price include the costs of refining, marketing and distribution, as well as federal and state taxes.

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Full Answer

Diesel prices also fluctuate based on seasonal changes in consumer demand. Heating oil demand increases during the fall and winter, which can increase diesel pump prices. Another factor in diesel prices is the distance of a supplier from a fuel refinery. Most US diesel refinement occurs in the Gulf Coast; locations far away from the Gulf tend to have higher fuel prices, as it costs more to transport fuel to retail locations in these areas.

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