Many factors determine gas prices
Posted: Thursday, February 17, 2005
Steve Hansen, the new vice president of refining at Tesoro Alaska, said he has been spending a lot of time explaining why gasoline prices are higher on the Kenai Peninsula than they are in Anchorage. Here are the reasons he gave:
Kenai Peninsula Borough and city taxes have a combined sales tax of about 5 percent.
Peninsula gas stations are spread out in a larger area. The distribution costs are higher than in Anchorage because they have to travel farther to deliver the fuel to gas stations.
Smaller volumes of gasoline are sold on the peninsula, contributing to higher prices. Anchorage has a high-volume market, which lends itself to more competitive prices.