Yep, gasoline prices are somewhat inelastic and the gov’t takes advantage of that with taxes. They stand to benefit from higher gasoline prices. Obama also wants to push his green initiative and wants to make it cheaper than gas for that reason. It’s about $4.20 here in So. Cal and at these prices, they are Obama’s wet dream.
Some states do add sales taxes to fuel costs, however, most states tax the fuel at a per-gallon rate. The fed rate on fuel has been 18.4 cents/gallon for gas and 24.4 cents/gallon for diesel for years now. So, in actuality, the higher the price of fuel, the lower the effective tax rate (again, the exception being where sales taxes are tacked on to the price).