Which State Has the Cheapest Gas Prices in the Nation?

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Andrew Koole
Updated on Apr 27, 2022 · 3 min read
Gas prices
aren’t a happy topic for American drivers right now. Across the country, the cost of a gallon of gasoline is rising to record levels. But the difference between what people pay from state to state is still vastly different.
California, for example, has an average cost of $4.63 a gallon, according to data analyzed by
Jerry
. At the same time, the cheapest gas prices in the country are found in
Oklahoma
, where the average cost for a gallon of gas is $3.03. 
Many factors are at play when it comes to the difference in gas prices across state lines, but part of what makes Oklahoma’s prices so low is its own natural oil reserves and refineries that produce the state’s fuel.
Gas prices are continuing to rise, but which state still offers the cheapest prices?

Why Oklahoma has America’s cheapest gas prices

There are a lot of things that make Oklahoma distinct from California. There’s the weather, the landscape, the people. But two distinctions make all the difference when it comes to gas prices—response to climate change and industry.
While both states rely heavily on agriculture for their economies, the similarities end there.
World Atlas
says California’s second-biggest industry is the wide net of “services,” including banking and tourism. The second most important industry in Oklahoma? Energy (read: oil).
Extracting and refining its own oil allows Oklahoma to save on transporting the fuel from other parts of the country and world, but the state also keeps gas cheap for its citizens by charging less tax at the pump. Its gas excise tax adds 19 cents to a gallon. California adds 51 cents.

Breaking down the nationwide spike in gas prices

Comparing Oklahoma’s gas prices to California’s helps explain why they are so different, but it doesn’t explain why prices are rising across the country. To understand that, we need to look at the current economy and what makes up the price of a gallon of gas in the first place.
The
Energy Information Administration
(EIA) says gas prices are mostly formed by four components: distribution and marketing, refining costs and profits, federal and state taxes, and the changing cost of crude oil.
The aspect causing the spike in prices
across the country
is, unsurprisingly, the price of crude oil, which EIA says makes up about half the cost of gas on its own. A year ago, a barrel of the stuff went for $42.16—now it costs $82.06.

How to save on car costs as gas prices rise 

Owning a car in Oklahoma might be cheaper than it is in California, but the cost is rising in both states. So what is a driver to do? 
Have no fear: there are many ways to keep
car ownership
expenses down. Some of them, like carpooling or working from home so you’re driving less, are obvious things to say but harder things on which to follow through. 
But one thing every car owner can do to save money is shop around for cheaper
car insurance quotes online
with Jerry. 
Jerry is a personal insurance broker that lives in your pocket. But don’t worry about buying tiny office furniture, Jerry is an app. 
Once you download Jerry, just answer a handful of questions that will take you roughly 45 seconds to complete and you’ll immediately get car insurance quotes for coverage similar to your current plan. Jerry customers save an average of $879 a year.

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