I've not looked at the kerosene price in awhile, but I suspect that it hasn't budged. My guess is it's so expensive because it's a convenience item here in this area. As far as I know, it's the only station within about 10 miles of me that carries kerosene, and my guess is that they don't sell a lot of it.
I remember when I was heating primarily with a kerosene heater in my first apartment and I felt horribly abused that I had to pay $2+ a gallon for it. Only there (Lewistown, Pa), because of the Amish, just about every station carried kerosene, and as far as I know most still do.