Why Your Gas Costs More at the Other Station

Driving with your parents always seemed to lead inexorably to one scenario when you were growing up: The car is low on gas, but someone is convinced there's a cheaper price at some other pump. You may now find yourself in the driver's seat, squinting at roadside signs to save a few cents per gallon. Now researchers have evidence to explain why.

Geographers at the University of California, Santa Barbara, have just released a study on how gasoline prices vary because of where each station is located. It turns out there's more psychology to how this happens than you'd think. First, your primary suspicion is, in fact, true: We pay for convenience, and conveniently located gas stations, especially close to highway on- and off-ramps, are more expensive. "The one with higher prices is likely to provide more direct access to food and goods," as co-author Jing Xu put it in a press release.

We also pay for lack of competition: Pumps that exist in the middle of nowhere, or the "urban fringe" between country and city, can write their own tickets. Gas stations that are close together, owned by a supermarket, or have a carwash or convenience store are most likely to be cheaper, especially if they're national or international companies.

This data doesn't include any deal you may have with branded credit cards, which can save you money, but generally only under specific conditions and for a limited time. If you're circling the block trying to find the best price, it's worth sizing up your surroundings before you pick your next pump.