Statewide average updated daily • Source: AAA
Texas consistently ranks among the cheapest states for gasoline in the country, typically sitting 20 to 40 cents below the national average. This is no accident — Texas sits at the heart of American oil and gas infrastructure, producing more crude oil than any other state and hosting the largest concentration of refining capacity in the nation along its Gulf Coast. For Texas drivers, cheap gas is one of the tangible everyday benefits of living in the energy capital of the United States.
Texas has a relatively low state gas tax of 20 cents per gallon, well below the national average and a fraction of what high-tax states like California charge. Combined with the federal rate of 18.4 cents, total fuel taxes in Texas come to just 38.4 cents per gallon — one of the lowest combined rates in the country.
The more significant advantage is geography. The Texas Gulf Coast is home to the largest cluster of oil refineries in the United States, processing a significant share of the nation’s total fuel supply. When refineries are literally in your backyard, transportation costs from refinery to retail station are minimal compared to states that receive fuel via long-distance pipelines or marine shipments.
Texas also benefits from an abundant local crude oil supply from the Permian Basin in West Texas, one of the most productive oil fields in the world. Local crude reduces feedstock transportation costs for Gulf Coast refineries, contributing to lower wholesale fuel prices that flow through to retail stations.
Did you know? Texas produces roughly 5 million barrels of crude oil per day — approximately 40 percent of total U.S. oil production. The Houston Ship Channel area contains one of the largest petrochemical complexes in the world. Texas has not raised its state gas tax since 1991, making it one of the longest unchanged fuel tax rates in the nation.
Compare today’s average in Texas 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.