Why do gasoline prices differ according to regions?

The prices for gasoline have caught people’s attention for a long time. According to the Energy Information Administration (EIA), the average retail gasoline prices tend to typically be higher in certain states or regions than others. As we know, the gasoline prices in west coast are much higher than those in gulf coast. Why do gasoline prices differ according to regions? The attached article points out four major factors that contribute to the differences in gasoline prices in distinct areas. Those four primary causes are proximity of supply, supply disruption, competition in the local market, and environmental program. For example, areas farther from the Gulf Coast where nearly half of the gasoline are produced in the US tend to have higher prices. Secondly, any event which slows or stops production of gasoline for a short time, such as planned or unplanned refinery maintenance can prompt bidding for available supplies. In addition, competitive differences can be substantial between localities with only one or a few gasoline suppliers versus one with a large number of competitors in close proximity. Last but not least, some areas of the country are required to use special gasoline. Areas that have environmental programs aiming at reducing carbon monoxide, smog and air toxics tend to have higher gasoline prices. Reformulated gasoline required in some urban areas and in California cost more to produce than conventional gasoline served elsewhere, increasing the price paid at the pump.