So there are infrastructure costs (refining, transportation, distribution, etc.) and other costs that go into the price we pay for our transportation fuels. the amount we pay per year is a function of 1) our investment in the vehicle (plus repairs, insurance, etc.) and 2) the annual cost of the fuel we use. the annual cost of fuel is a function of how much we pay for fuel, how many miles we drive (often noted as vmt or vehicle miles traveled), and the fuel efficiency of our vehicles (mpg).
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