x
Breaking News
More () »

Feeling pain at the pump? A look at who controls these record-high gas prices

Seventy percent of the cost of a gallon of gas is tied to the cost of crude oil.

INDIANAPOLIS — As the price at the pump soars across the country, drivers are wondering how high they’ll go and who — or what — is to blame. 

"Any time you have geopolitical conflict, especially with an oil-producing country, you're going to see higher prices," said Indiana University economist Kyle Anderson. 

Anderson said the conflict in Ukraine is sending oil prices soaring. According to the U.S. Energy Information Administration, crude oil and the process of refining it accounts for 70% of the price of a gallon of gas.

The rest is marketing, distribution and taxes.

But Anderson said it's not just the price of oil that's going up. So, too, is demand.

"People are traveling more. Been pent up with the pandemic," he said. "So a lot of this is just excess demand from what we've had over the last couple of years."

Additionally, gas prices traditionally go up in the spring when refineries switch over to a summer blend of gasoline.

RELATED: Don't pay full price for gas. Do this instead

U.S. refineries are expected to ramp up production, but experts say it will take weeks or months to make a difference.

Many 13News viewers have been asking how much control the government has over the price of gas and how much relief can be offered at either the state or federal level.

"Not very much, especially in the short run," Anderson said.

Some lawmakers have asked President Joe Biden to open up the nation's strategic petroleum reserve. Gas prices have also renewed political debate on the United States' climate policies. In the long run, experts say those policies can have an impact, but that's all at the federal level of government.

So what about closer to home? 

When it comes to the state gas tax, the governor does have the power temporarily suspend it, and that's happened before, including in 2000. 13News reached out to Governor Eric Holcomb to ask whether that's something he’s considering, and what it would take to consider it. He has not yet responded.

RELATED: 'Forget the $4 per gallon mark' | Gas prices accelerating to all-time high

In Washington, some are pressuring lawmakers to suspend the federal gas tax, too. But Anderson said that doesn't come without its own problems.

"On the one hand, every little bit helps. On the other hand, those tax dollars go toward road repairs and highway transportation funds, so they're an important source," he said.

As you can see, when it comes to our relationship with gas prices, it's complicated, and with summer approaching, it's about to get even more expensive.

"So I wouldn't be surprised if we're looking at another 30- or 40-cent increase we'll see in the next few months," Anderson said. "Unfortunately, that could very much happen."

Paid Advertisement

Before You Leave, Check This Out