Gas prices have skyrocketed across the United States in 2026, with prices the highest they’ve been since 2022. As of early April, the average price for a gallon is $4, a rise primarily fueled by the Iran war. As a result, gas prices have changed daily — and sometimes multiple times a day — and drivers are starting to seethe while at the pump. But gas stations haven’t actually benefited from these ballooning gas prices. 

According to Patrick De Haan, Head of Petroleum Analysis at GasBuddy, gas stations don’t make more money when prices rise — in fact, it’s the opposite. Speaking to AP News, De Haan said that “The margins shrink when prices go up because it’s harder for [gas stations] to pass along the increases as quickly as they themselves get them.” The profits, then, are going to the companies that extract and refine crude oil, not the retailers you buy your gas from.

If gas stations aren’t profiting from the increased gas prices, why do gas stations have different prices? There are actually a lot of factors that go into setting the price of a gallon, largely based on location and taxes. 

The biggest factor is geography. For one, gas prices can change from state to state due to taxes. For example, California’s gas taxes and fees totaled about 71 cents per gallon last year — for the gas stations to make a profit, they have to raise the prices to offset these taxes. On the other side of the coin, some states have (or are close to) oil refineries, which makes for shorter delivery distances and lower prices.

Prices can also vary within states. The brand, as well as the volume of gas sold, will factor into the pricing. Some gas stations may be in very convenient locations off the highway, allowing them to get away with higher prices. And if there are two gas stations near one another, one may lower its prices, hoping to draw customers away from its rival. Thus, if you want to save some money as gas continues to rise, use a gas-finding app to locate the gas station with the lowest prices wherever you are.