Why is gas expensive in New York?
New York drivers pay $3.46 per gallon, about 7 cents above the national average. The state's combined fuel-tax burden of about 65 cents per gallon is the fourth-highest in the country, and the New York City metropolitan area falls under the federal Reformulated Gasoline program. New York has few in-state refineries and depends on supply from Pennsylvania, New Jersey, and abroad.
What you're paying for
State taxes and policy in New York add an estimated $0.81 per gallon on top of the roughly $2.65 base cost (crude oil, distribution, and the federal excise tax) that every U.S. driver pays.
Against its neighbors
Amber line marks the U.S. average of $3.38.
Price over time
New York U.S. average
New York, explained
Why are New York gas prices higher than the national average?−
Three factors. First, the state's combined tax burden of about 64 cents per gallon, including the state excise tax, the Petroleum Business Tax, the regular state sales tax, and the Metropolitan Commuter Transportation District surcharge. Second, the federal Reformulated Gasoline program requires a cleaner-burning blend in the New York City metropolitan area, adding about 8 cents per gallon. Third, New York has no operating refineries; supply must arrive by pipeline from Pennsylvania and New Jersey or by waterborne tanker.
How much is the New York gas tax?+
The combined state burden is about 64 cents per gallon. The base excise tax is 17.6 cents; the Petroleum Business Tax is about 17 cents; the state sales tax applied to fuel averages about 14 cents at current prices; the MCTD surcharge adds about 1 cent. Combined with the 18.4-cent federal excise tax, total tax burden in New York is about 82 cents per gallon, second only to California.
What is the Petroleum Business Tax?+
The New York Petroleum Business Tax is a state-level excise tax on petroleum products at the wholesale level. The rate is automatically adjusted each January based on the prior year's average petroleum prices. In 2026, the PBT on gasoline is about 17 cents per gallon. The tax is paid by petroleum-product distributors and passed through to retail consumers.
Does New York have a cap-and-trade program for motor fuels?+
Not yet. The New York Cap-and-Invest program, modeled on California's cap-and-trade, has been proposed and is undergoing rulemaking. It is currently scheduled to take effect in 2027 and would cover transportation fuels. Our model projects a price effect of about 25 to 40 cents per gallon if implemented at the proposed allowance prices.
Why are New York prices similar to Pennsylvania's?+
Both states are in PADD 1, the East Coast refining region, and share much of the same wholesale supply infrastructure. Pennsylvania has slightly higher prices ($3.52 vs New York's $3.46) primarily because of Pennsylvania's higher state excise tax of 58.7 cents per gallon, which is the highest in the country.
How will the proposed Cap-and-Invest program change New York gas prices?+
The New York Cap-and-Invest program, if implemented as currently designed, would require fuel suppliers to buy emission allowances for the greenhouse gases produced by the fuel they sell. The compliance cost would be paid by suppliers and passed through to consumers. Based on Washington's experience with the Climate Commitment Act, our model projects an immediate price impact of 25 to 50 cents per gallon, with longer-term increases as allowance caps tighten.