WASHINGTON, DC (07/14/2026) – The Institute for Energy Research released a new report today titled “The Pacific Premium: Why Gasoline Costs More in Democratic-Controlled States,” revealing the stark fuel price gap between Democratically-controlled states and those governed by Republicans.
The study reveals a price gap of 55 cents per gallon between Blue and Red states. On the West Coast, this gap is even larger, climbing to 91 cents per gallon. This disparity is the result of direct policy decisions, including accumulated environmental regulations, high fuel taxes, and refining constraints.
Tom Pyle, President of the Institute for Energy Research, issued the following statement:
“This new report asks and answers a straightforward question: why is there such a large gap in the price of fuel between states controlled by Democrats and those governed by Republicans? The answer, just like we found with the price of electricity, is directly related to policy.
“While steadily rising gasoline prices nationally are taking a bite out of household budgets, some states consistently pay more on average for a gallon of gasoline. Pundits point the finger at the situation in the Middle East, but the data tells the whole story. The persistent fuel price gap between Blue and Red states is no coincidence; it is a choice.
“Current global politics has certainly played a role in the current pain at the pump, but that’s not the full picture. Much like with electricity rates, states play an outsized role in determining what motorists pay at the pump. For over a decade, Blue state politicians, especially on the West Coast, have made very deliberate policy choices that have steadily increased fuel prices in those states. Every passage of a fuel tax or carbon tax at the local level is passed on to consumers and directly impacts what drivers pay at the pump. The bottom line is this: state energy policies matter, and elections have real consequences.”
Key Findings From the Report:
- The Party Gap: In early 2026, states under unified Democratic control averaged $3.69 per gallon for regular retail gasoline, while unified Republican states averaged $3.14 per gallon—a gap of $0.55 per gallon. Over the full 2017–2026 data window, this gap averaged roughly $0.45.
- The Root Causes: Approximately two-thirds of this price difference is directly traceable to four measurable factors: state gasoline taxes, federal reformulated-gasoline rules, the West Coast refining region, and California-specific fuel costs.
- The Pacific Premium: The West Coast price premium (after adjusting for taxes and isolation) hovered between $0.20 and $0.44 per gallon from 2017 to 2021. By 2026, that premium climbed to $0.91 per gallon, driven largely by new carbon tax programs and a steep loss of regional refining capacity.
- Policy Accumulation: A state’s cumulative years of Democratic control since 2001 is a stronger predictor of its 2026 gasoline prices than its current party alignment. Each additional year of unified control since 2001 adds an average of 3.6 cents per gallon to today’s pump prices.
IER Experts Available For Interview On This Topic:
- Tom J. Pyle, President
- Kenny Stein, Vice President of Policy
- Alexander Stevens, Manager of Policy and Communications
- Daniel Simmons, Adjunct Fellow
- Caleb Jasso, Senior Policy Advisor
Additional Background Resources From IER:
- The Pacific Premium: Why Gasoline Costs More in Democratic-Controlled States
- Nothing Like Raising Your Taxes to Celebrate America’s Independence
- California’s High Gas Prices Are Unnecessary
For media inquiries, please contact THOMAS.PYLE@IERDC.ORG
