Consumer Price Index

Measuring Price Change in the CPI: Motor fuel

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 monthly at the U.S., regional, and area level. In addition, an average price per gallon is published monthly for gasoline (all types), regular unleaded, midgrade unleaded, premium unleaded, and diesel at the U.S. and regional level, and for select areas.

Item definition

The gasoline (all types) index, which has the majority of the weight of the motor fuel index, is composed of three grades of gasoline:

  • Regular unleaded gasoline: Gasoline having an octane rating greater than or equal to 85 and less than 88.
  • Midgrade unleaded gasoline: Gasoline having an octane rating greater than or equal to 88 and less than or equal to 90.
  • Premium unleaded gasoline: Gasoline having an octane rating greater than 90.

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 automotive fuels such as propane, natural gas, kerosene, alcohol, and electricity that is sold for use in consumer automobiles.

Relative Importance

The relative importance of an item category is its percent of the CPI weight as of December of the most recent year.

Table A. Relative importance, December 2018
Item Relative importance

Transportation

16.348

Public transportation

1.113

Private transportation

15.235

Motor fuel

3.762

Gasoline (all types)

3.671

Other motor fuels

0.091

Sample selection

In order to determine where to collect information on specific categories, including the five motor fuel categories, a Telephone Point of Purchase Survey (TPOPS) is conducted by the U.S. Census Bureau. The TPOPS is used to collect data about where consumers purchase goods and services and how much they are spending. The data from the TPOPS are then used to select the retail establishments in which BLS monitors the prices of motor fuels.

Unlike most other items in the CPI where individual item categories are sampled, all five motor fuel categories are automatically selected at any sampled motor fuel retailer in the current survey. Prices are collected as a per-gallon pricing unit, and include excise and sales taxes.

CPI data collectors 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)
  • Type of alternative motor fuel

Price Change

All price information for motor fuels in the CPI is collected by CPI data collectors, and evaluated for index use by CPI analysts in the Washington Office.

For motor fuel, the CPI returns every month to the sampled outlets to obtain the current prices of the selected items, including any changes or discounts. Any characteristics of the selected items that have changed are also identified and reviewed. When the price of an item changes, the CPI analyst tries to determine a reason for the change; however, if the characteristics remain unchanged, the CPI usually reflects the price change without any adjustments.

Because motor fuels are usually available, there are few item replacements caused by item availability. Nevertheless, if a replacement is needed and it is essentially the same as the predecessor item, the CPI treats any price difference between the replacement item and its predecessor as pure price change. If the characteristics of the item changed and the reported change is one that provides little value to the consumer, the CPI will show the unadjusted price change.

Data

Access data for motor fuel in our online database.

Additional information

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. Sampling techniques and methodologies 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.
  • American Automobile Association (AAA): A member organization 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 fuel 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 price movements.

Additional information may be obtained from the Consumer Price Index Information Office by email or calling 202-691-7000. Information on the CPI's overall methodology can be found in the BLS Handbook of Methods.

Last Modified Date: May 22, 2019