Statewide average updated daily • Source: AAA
New Mexico gas prices typically run near the national average, occasionally dipping slightly below it in Albuquerque and along the I-40 corridor where retail competition is relatively strong. The state has a low tax rate and benefits from its own significant oil production — New Mexico is one of the top three oil producing states in the country, with the Permian Basin extending into its southeastern corner — though like other oil producing states the crude production does not automatically translate to cheap retail gasoline without sufficient local refining capacity.
New Mexico’s state gas tax is just 17 cents per gallon — one of the lowest in the country, tied with Missouri for second lowest. Combined with the federal rate the base tax burden is just 35.4 cents per gallon, among the lowest nationally.
New Mexico has limited local refining capacity despite its substantial crude production. The state receives most of its refined fuel via pipelines from Texas and from the El Paso area refineries, with Albuquerque serving as the main distribution hub. The low tax rate helps offset some of the transportation cost premium that comes with distance from major refining centers.
Rural New Mexico — particularly the vast stretches of southeastern desert near the Texas border, northern New Mexico near the Colorado border, and the northwestern Four Corners region — faces higher prices due to long delivery distances and minimal station competition across one of the most sparsely populated landscapes in the continental United States.
Did you know? New Mexico is one of the top three oil producing states in the country — the Permian Basin extends into southeastern New Mexico around Carlsbad and Hobbs, producing hundreds of thousands of barrels per day — yet the state imports most of its finished gasoline from Texas. New Mexico has the second lowest state gas tax in the country at just 17 cents per gallon, reflecting the oil industry political culture and the need to keep fuel costs low for residents with large rural distances. The Route 66 corridor running through Albuquerque continues to serve road trippers much as it did when Route 66 was the main road west.
Compare today’s average in New Mexico with nearby states to understand regional price differences.
Learn more about what drives gas prices across the United States.
Crude oil prices are the biggest driver of what you pay at the pump. For U.S. and global crude oil production data updated from EIA figures, see Oil Production Live.