How BLS Measures Price Change for Motor Fuels in the Consumer Price Index
The motor fuel index, a component of the private transportation
index, is included in the transportation group of the Consumer Price Index (CPI).
Together with the index for household fuels, it makes up the special energy index.
The motor fuel index is published on a monthly basis for all areas for which CPI
data are published.
The individual items which comprise the motor fuel index, together with their
relative importance values within the U.S. city average of the CPI for All Urban
Consumers (CPI-U), as of December 2007 are as follows:
Table 1: Relative Importance of Selected Transportation components of the CPI for All Urban Consumers (CPI-U): U.S. city average, December 2004
| Other Motor Fuels
The Gasoline (all types) index, which has the majority of the weight of the motor
fuel index, is composed of three types of grades of gasoline.
- Unleaded regular gasoline - Gasoline having an octane rating
greater than or equal to 85 and less than 88;
- Midgrade gasoline - Gasoline having an octane rating greater
than or equal to 88 and less than or equal to 90;
- Premium gasoline - Gasoline having an octane rating greater
High altitude areas of the country have gasoline octane ratings that may be
different than the ranges given above.
The Other Motor Fuels index is composed of automotive diesel fuel and alternative
Selection and identifying characteristics to be priced
Information from the Telephone Point-of-Purchase Survey (TPOPS) is used to select
the outlets surveyed for the motor fuel index. Prices are collected for every grade
of gasoline (provided each grade is available) at every outlet selected. The prices
collected are classified as a per-gallon pricing unit and include all taxes, both
excise and sales taxes. The monthly price change in the motor fuel index is
determined by the price changes reported for selected items in the selected outlets.
The current CPI outlet sample for gasoline (all grades) is approximately 1035
CPI field staff must first determine the type of motor fuel priced by observing
the motor fuel pump at the outlet. The following are characteristics that
would be identified:
- Type of service self service or full service
- Payment type cash, credit card, and debit card, etc.
- Brand name specific name of gasoline company
- Pricing unit usually per gallon
- Octane rating as specified on pump (usually 85 to 93)
Notes on substitution and quality adjustments
Because motor fuels generally always are available, there are very few item
substitutions caused by item availability. Additionally, octane level changes,
provided they occur within a specified range, and outlet or brand name changes
are examples of situations where there would be no need for item substitutions
all other things being equal. A scenario that would precipitate the need for an
item substitution would be a change in the level of service, full service versus
self-service, available at the outlet.
There are no explicit quality adjustments made for changes in fuel or service
quality. Adjustments are not made for switches in gasoline content due to mandated
air quality requirements. 1
Table 2: Distribution of Observations
Number of Observations
| Gasoline (All Types)
| Other Motor Fuels
Other sources of information on motor fuel price changes
Although the CPI for Motor Fuel is reported monthly, there are numerous government
agencies and independent associations that report motor fuel data using different
time periods. In addition, sampling techniques and sampling methodology differ for
the various groups reporting data. Three of the more well-known agencies reporting
motor gasoline prices are:
Energy Information Administration (EIA) a division of the Department of Energy
that publishes retail gasoline prices weekly for all three grades of gasoline from a
sample of approximately 800 retail gasoline outlets. The prices collected represent
self-service except in areas having only full service. The sampling methodology used by
EIA is as follows:
"The sample for the Motor Gasoline Price Survey was drawn from a frame of
approximately 115,000 retail gasoline outlets. The gasoline outlet frame was
constructed by combining information purchased from a private commercial source with
information contained on existing EIA petroleum product frames and surveys. Outlet
names and zip codes were obtained from the private commercial data source. Additional
information was obtained directly from companies selling retail gasoline to
supplement information on the frame. The individual frame outlets were mapped to
counties using their zip codes. The outlets were then assigned to the published
geographic areas as defined by the EPA program area, or for conventional gasoline
areas, as defined by the Census Bureaus Standard Metropolitan Statistical Areas
(SMSA) by using their county assignment." 2
American Automobile Association (AAA) - an independent agency which publishes
updated retail gasoline price data daily. Price data are derived from credit card
transactions at over 60,000 gasoline stations throughout the country.
Lundberg Survey - an independent market research company offering local and
national coverage of fuel prices and fuel taxes. Retail prices of gasoline and
diesel fuel are gathered twice-monthly in 68 markets, covering all states and
Washington, D.C., or on special request in other areas and frequencies.
Although these other sources may appear to show different fuel price movements
from the CPI, the apparent differences are due to timing. For example, the EIA data
are released each week and correspond to prices on a particular day. The CPI motor
fuels index corresponds to average prices over a calendar month. BLS research has
consistently shown that when timing differences are taken into account, the CPI and
EIA are extremely similar in their movements.
(1) CPI Detailed Report, "Treatment of Mandated Pollution Control Measures in the CPI," (September 1998).
(2) Energy Information Association, "Sampling Methodology," available at
http://www.eia.gov/oil_gas/petroleum/data_publications/wrgp/sampling_methodology.html (visited October 25, 2011).
Additional information on the Consumer Price Index
can be found in the BLS Handbook of Methods,
chapter 17, "The Consumer Price Index,", available on the BLS Internet site
For more information, call the Information and Analysis Section of the CPI at
(202) 691-7000 or send e-mail.
Last Modified Date: October 26, 2011