When compared with other processed liquids, a gallon of gasoline is much cheaper than many other products Americans consume each day. For example, the average price of whole milk is about $3.50 a gallon and premium bottled water is nearly $4 a gallon. Brand name beer costs the equivalent of $9.75 a gallon and a gallon of a popular over-the-counter eye refresher sells for the equivalent of $895 a gallon. The graphic shows how the price of gasoline compares with other processed liquids on a gallon-per-gallon basis, based on gasoline selling at $3 a gallon (which, on average, includes nearly 50 cents a gallon for federal, state and local taxes.)
Consider how much of the American consumer’s income is spent on gasoline. While that number has likely grown in recent years, disposable income has gone up significantly in the last 25 years. For example, consumers currently spend about 4 percent of their disposable income on gasoline, compared with more than 6 percent in 1981. That year, gasoline spending as a share of disposable income reached its highest level in the last 50 years, according to the U.S. Energy Information Administration.