States that have eliminated gas taxes, such as Georgia and Indiana, have some of the lowest gas prices in the country.
WASHINGTON — The national average price of a gallon of gasoline was $4.564 Thursday as millions of Americans prepared to drive to their Memorial Day destinations. An increase of approximately US$1.38 over last year, an increase of 43.4%.
According to AAA, 39.1 million Americans will drive at least 50 miles from their homes between Thursday and Monday, May 25.
AAA notes that despite higher gas prices, flights booked in advance will cost less than last year. An estimated 3.66 million people will fly over Memorial Day weekend.
Still, higher prices are unlikely to slow travelers down. AAA expects about 100,000 more road trips this weekend.
Impact of the Iran War:
Natural gas prices have soared since the United States and Israel began launching attacks on Iran in late February. Particularly important to increased oil production is the closure of the Strait of Hormuz, a vital waterway largely controlled by Iran that connects the oil-rich Persian Gulf states of Kuwait, Iraq, Saudi Arabia, Qatar, Bahrain and the United Arab Emirates to the rest of the world.
Although President Donald Trump’s administration initially hoped that an April ceasefire would open up trade in the Strait of Hormuz, the blockade continues, stranding more than 1,500 ships from 87 countries in the Persian Gulf.
Trump has repeatedly set deadlines for Tehran to open the strait, but then backed off. Earlier this month, Trump said the U.S. military would begin guiding stranded ships through the strait. The next day, the president said he The effort is being paused to see if a deal can be reached.
Impact of fuel tax:
Georgia Gov. Brian Kemp suspends state’s gas tax in anticipation of upcoming Memorial Day travel Two more weeks. The extension started on Wednesday and will last until June 3.
“As Georgia families prepare for the Memorial Day travel weekend, they shouldn’t be blindsided by prices at the pump,” Kemp said Friday, citing AAA’s travel forecast.
A bill passed by the state Legislature in March that temporarily suspended the gas tax was scheduled to expire on Tuesday. The law saves drivers 33.3 cents per gallon of gasoline and 37.3 cents per gallon of diesel.
Indiana is also suspending its gas tax until Memorial Day weekend. Governor Mike Braun Extending state’s moratorium Earlier this month, the gas tax expanded the measure to include discontinuing the 36-cent excise tax.
Georgia and Indiana had the second- and third-cheapest gas prices among U.S. states on Thursday, with both states holding prices more than 50 cents below the national average.
Since the excise tax increase on May 8, gas prices in Indiana have dropped by 49 cents, while the national average has increased by 2 cents.
Compared to its Midwestern neighbors, Indiana is about $1 cheaper than its neighbor to the west, Illinois.
Mississippi has the lowest average regular gas price at $4.017, meaning every state in the country has an average price above $4 as of Thursday.
In both Indiana and Georgia, gas taxes are used to repair state highways and local roads. In 2024, Indiana collected More than $1 billion in gas tax revenue. Georgia collects more than $2 billion per year From motor fuel taxes.
Taxes are just one factor that affects the differences in gas prices from state to state. While California leads the nation in gas taxes and prices at $6.143 per gallon, Hawaii, the state with the third-highest gas prices, has the lowest gas taxes in the country.
Proximity to refineries, the amount of natural gas passing through the area, and nearby alternative fuel options also affect natural gas prices.
Highest average gas prices by state as of Thursday:
- California: $6.143
- Washington: $5.788
- Hawaii: $5.646
- Oregon: $5.353
- Alaska and Nevada: $5.273
Lowest average gas prices by state:
- Mississippi: $4.017
- Georgia: $4,032
- Indiana: $4.048
- Louisiana: $4.057
- Texas: $4.092
For diesel prices, the contrast is even starker
Diesel costs averaged $5.656 per gallon Thursday. That’s about $2.10 more than the cost per gallon of diesel this time last year.
When was the highest average gas price ever?
The highest average price per gallon of gasoline recorded was set on June 14, 2022, during the early months of Russia’s invasion of Ukraine, when the national average price was just over $5.
