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Discussion Starter #1
If the US did away with regular fuel and only produced premium, would gasoline prices go down? :2huh:

Here’s my reasoning;

Currently there are summer and winter blends nationwide in addition to a plethora of localized blends (15 or so) for different metropolitan communities (thanks to the EPA).
http://www.epa.gov/oms/rfg.htm

So all these blends have to be mixed, stored, transported, and pumped separately. At the delivery site they have to make sure the premium goes into the premium tank and the regular goes into the regular tank, the pumps have to pump three versions, etc. etc. etc. All that complexity to the infrastructure does nothing but add to the cost.

So by going to only premium:

First, the production would be streamlined since only one octane would be produced. Then the refineries would only have to make the special blends. (The smart person would build mini-refineries near the metropolitan areas requiring the special blends and only produce those unique blends needed. Thus increasing the overall refinery capability and also relieving the large refineries from having to produce the multiple mixtures.)

Then the entire specialized infrastructure could be eliminated. All the tanks at a gas station would hold the same fuel. Only one pump would be needed (excluding diesel), only one price would be paid, etc. To my knowledge every vehicle sold in the US will run perfectly well on 92 octane, so it isn’t like it would be harming anyone’s car.

And finally as a side effect, new cars could be tuned for more efficiency (better mpg) and power by utilizing the higher octane. Car manufactures wouldn’t have to build cars to run on the piss water we call regular 87 octane fuel. And since most new cars today have knock sensors anyway the point is pretty much moot. Just have the EEC look at knock to determine timing advance (in addition to the normal things it looks at).

So what do you guys think? Should we get rid of regular? Would it lower prices?
 

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NO... just increase profits for the oil companies... or give a reason to raise tax's on fuel.


One thing I have learned is once a price it considered exceptable (at 3.50 people moan but are no screaming over gas) you will never see it drop below that again.
Super Unleaded (with 10% ethanol) is selling for $3.19 here.

The oil companies are still slaves to the price of crude. Granted, they won't reduce the price anywhere near as quickly as they will increase, and they will look for any reason to increase prices, but if they are selling for too much over what it should be considering crude prices, people will moan and complain again too. Besides, I heard that gas was supposed to get up to $7 or even $10 by the end of the summer :eek:

The plan mentioned above might reduce prices eventually, but the cost of the infrastructure change, the cost of the added "micro-refineries" and the cost of station changes would far outweigh the initial benefits, and prices would be huge. Not to mention all the people that would complain about not having the options for cheaper gas, as well as the 10% and 85% ethanol choices.

Not to mention that every vehicle manufacturer builds vehicles that can be used in more than one country. I know Mexico's gas might as well be yellow water, so why build a vehicle that cannot be sold or driven in a neighboring country?
 

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Discussion Starter #4
The plan mentioned above might reduce prices eventually, but the cost of the infrastructure change, the cost of the added "micro-refineries" and the cost of station changes would far outweigh the initial benefits, and prices would be huge. Not to mention all the people that would complain about not having the options for cheaper gas, as well as the 10% and 85% ethanol choices.
The 10% blend is nationally mandated in the future with a lot of the States giving large incentives (or mandating) to stations to use the 10%, so (IMHO) eventually we won't even be able to buy “pure” gas. And the E85 is growing anyway. I'm not saying stop that program or any other program. What I'm recommending is a short term, minimal impact change that "should" lower prices.

Excluding the micro-refineries (no matter what, the US needs more refineries.... located somewhere outside Texas!!) what would be the cost to change the infrastructure?

I may be missing something but all I can think of that would need to change is the following:
Changing the labels on a pump to all say “Regular, 92 octane”
Programming the pumps to have the same price no matter which you select
Labeling the tanks (are there different fitting on the tanks for premium vs regular?)
The truckers would no longer have to worry about delivering premium or regular, all they would have to deliver now would be gasoline and diesel.
The pipelines would only have to worry about piping gasoline, and not worry about what flavor the gasoline was. I think I read somewhere that one pipeline had to deal with 38 different mixtures…

It isn’t like we would have to install hydrogen refueling sites!! :beek:

The pumps don’t care whether there’s 92 octane in the tanks or if there is 87 octane in the tank. And most of the infrastructure is simply a transportation and storage of gasoline. There’s not any difference between the transportation and storage of regular or premium. So the infrastructure change would be minimal. I would bet that a gas station could change over to just running 92 octane with an hour or two, with no major hardware required. But again, I may be missing something about the infrastructure that I don’t know.

As for selling in other countries, with the knock sensors they would still run fine on the lower octane.

What I don't know is if the formula for premium is that much different than regular that the materials are more expensive and/or not available. That could be a show stopper.

As for the people… tell them we are getting rid of premium and midgrade and keeping regular, but increasing the octane. Those with high performance cars would (hopefully) know that their car will be fine, and the rest of the people won’t know the difference. Or care if the prices went down. :D
 

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Most gas stations still sell mid-grade (a complete waste of money), I can't see the oil companies dropping 2 grades of gas.
 

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I guess it all depends on how the gasoline is produced. If the refinery must change the mixing equipment every time they want to produce premium vs regular, then if the refinery could make premium cheaper if they were to switch to premium only production. HOWEVER, this does not mean that the production of premium would necessarily be cheaper than the production of regular. I would also assume that it is entirely possible to make different grades of gasoline at the same time considering each fuel is simply a mix of the products given off by fractal distillation of crude oil plus some additives (which premium fuels have more of, BTW).

Price of a factory produced product is also more than just the raw cost + manufacturing costs, it also must include labor, processing, storage, and transportation costs. A product that can be made quicker will be cheaper because of the lesser amount of labor as well as the increased capability for "Just in time" manufacturing where the product is shipped out immediately after production. This decreases the amount of storage needed, and makes it easier to schedule shipments.

I suppose there wouldn't need to be any change at the pump, but there would still be two separate tanks and pumps for the same fuel then. Since we already have that, and the fact that transporting a semi tank full of premium is the same as transporting a semi tank full of regular, we might as well keep the system we have. That way the car companies do not need to create special computer programing for the optimization of whatever octane you use, and they can still keep the high compression ratios for the performance cars.
 

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Most gas stations still sell mid-grade (a complete waste of money), I can't see the oil companies dropping 2 grades of gas.
Around here, midgrade is made with 10% ethanol, and is a whole 10 cents cheaper than regular. I use it quite often.
 

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Our midgrade is exactly that, half way in price and octane between regular and premium. If your car requires premium, midgrade doesn't cut it and if you only need regular, it does nothing for your car. All of our gas here in AZ uses 10% ethanol.
 

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10% ethanol costs the same as regular w/o it. here it does

is that illegal?
 

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The 10% blend is nationally mandated in the future with a lot of the States giving large incentives (or mandating) to stations to use the 10%, so (IMHO) eventually we won't even be able to buy “pure” gas. And the E85 is growing anyway. I'm not saying stop that program or any other program.
I AM! That ethanol blend is one of the stupidest ideas they have come up with in a long time. It doesn't make gas cheaper, all it does is hurt your gas mileage and make food more expensive, while at the same time screwing with the fuel systems on cars that were never designed for it. They never should have started with that crap, and I can't believe they are still doing it. Around here, a few months ago they finally came to their senses and stopped putting ethanol in the gas. I hadn't heard that some states were mandating that now, but hopefully they will come to their senses before that goes through. Probably not though.
 

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When they switched to 10% ethanol, I lost 10% in mileage. Gee Thanks.

The refineries just make the base product, the distributor adds the state or local additives to make the "blend".
 

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One thing I have learned is once a price it considered exceptable (at 3.50 people moan but are no screaming over gas) you will never see it drop below that again.
+1 on that.

What I'm not completely understanding is why diesel is way more expensive here. I was under the impression that it is refined much lesser than gas....not that it bothers me directly as I don't own a diesel powered vehicle, but it makes everything else go up in price due to the increased trucking/transporting costs.
 

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Interesting concept. In theory it might work. In reality it will never happen.
 

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The reason diesel is so much more expensive is that the refineries aren't set up to make as much of it. Basically given one barrel of crude, the more diesel you make, the less gas you can make. For americans who use lots of gas and not so much diesel, we are set up to make much less diesel than say in europe, where many passenger cars are also diesel powered. They could lower the price of diesel, but it would be at the expense of raising the price of gas, so certainly for now that isn't going to happen.
 

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+1 on that.

What I'm not completely understanding is why diesel is way more expensive here. I was under the impression that it is refined much lesser than gas....not that it bothers me directly as I don't own a diesel powered vehicle, but it makes everything else go up in price due to the increased trucking/transporting costs.
Diesel is taxed more.
 
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