During the last month, the transportation industry has been witness to the unsteady fluctuation related to diesel rates, especially in California. But why is this region the most affected? Diesel prices vary by region or state and local taxes. Diesel prices for retailers tend to be higher the farther the source of supply and sale of diesel is. Because transportation costs increase as the distance of the diesel supply source increases, such as refineries, ports, pipelines and blending terminals.
Retail competition and operating costs play a role in diesel pump prices. The fuel pump prices of diesel stations are usually higher in places with fewer diesel stations. Even stations located together can have different prices. Let`s see the factors:
- Taxes and Price Variances in Regional Markets
Every state has variations on their price which is partly caused by the different taxes on gas for each state and retailer.
- Sale costs
The costs for retailers can fluctuate from 10 to 20 cents per gallon, especially in certain locations, because wholesale corporations have Truck Stops throughout the US.