Soaring Gas Prices Squeeze Retailers and Consumers

Factors beyond station control drive up costs, leaving small operators and drivers feeling the pinch

Apr. 3, 2026 at 10:25am

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A geometric abstract illustration using bold shapes and primary colors to conceptually represent the volatility and economic pressures of rising gas prices.As gas prices soar, the economic pressures ripple through the supply chain and impact both small retailers and drivers.Des Moines Today

The near-daily changes in U.S. gas prices are dizzying for drivers, who are feeling frustrated and cash-strapped by the highest fuel costs since 2022. With the Iran war pushing up prices worldwide, the U.S. average for a gallon of gas topped $4, but gas station owners say they are just passing along the higher wholesale costs they are facing and struggling to maintain tight margins.

Why it matters

The volatility in gas prices is impacting both small retailers and consumers, as stations must quickly adjust prices to account for fluctuating wholesale costs, while drivers are forced to cut back on other spending to afford the high fuel prices. This highlights the complex dynamics of the oil and gas supply chain, where factors largely outside of a station's control are driving up costs.

The details

Oil prices soared when U.S. markets opened Thursday following President Donald Trump's speech promising retaliation against Iran, pushing up wholesale fuel prices that gas stations must pass on to consumers. Retailers like Lonnie McQuirter of 36 Lyn Refuel Station say they are facing higher wholesale costs, credit card fees, and maintenance expenses, leaving them with tighter profit margins despite the high prices at the pump. Roughly half the price at the pump pays for the cost of crude oil, with about 20% going to refiners and 20% in taxes, leaving just 10% for retailers after expenses.

  • On Thursday, the U.S. average gas price topped $4 per gallon, the highest level since 2022.
  • Wholesale fuel prices have been increasing multiple times per day, forcing stations to frequently adjust their pump prices.

The players

Lonnie McQuirter

Director of operations at 36 Lyn Refuel Station in south Minneapolis, who says his margins have gotten much tighter due to rising wholesale costs and other expenses.

Jeff Lenard

Vice president at the convenience store trade group NACS, who says retailers' markup has averaged about 38 cents per gallon over the past five years, with stations keeping roughly 15 cents per gallon after expenses.

Patrick De Haan

Head of petroleum analysis at GasBuddy, who compared gas station owners to homeowners, saying they are "price takers, not makers" when it comes to the volatile oil and gas market.

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What they’re saying

“We price based on what we're able to buy fuel at, and how well we can operate. They've got different economics.”

— Lonnie McQuirter, Director of operations, 36 Lyn Refuel Station

“If I was selling a house today, I'd be beholden to whatever the housing market is. That's the same for gas station owners. Whatever the price of oil and gasoline are, they are a price taker, not maker.”

— Patrick De Haan, Head of petroleum analysis, GasBuddy

What’s next

Analysts are closely watching whether the high gas prices will start to significantly impact consumer demand, which could in turn affect the broader economy.

The takeaway

The spiraling gas prices highlight the complex dynamics of the oil and gas supply chain, where factors largely outside of a gas station's control are squeezing both small retailers and consumers. This underscores the need for greater transparency and stability in the market to protect both businesses and drivers.