Extract

To extract from a USB drive the best syntax is

gunzip -c /media/usb_drive1/file.tar.gz | tar -xvf -

The -c option extract to standard output which is the console.

-c --stdout --to-stdout
Write  output on standard output; keep original files unchanged

This is piped to tar. So if you keep the current directory where you want the extracted files to be, you can directly unzip from the USB drive