Gasoline 101: Your First Lesson in the Economics and Politics of Petrol
By: Mike Magda Posted: 04-15-04 21:13
© 2004

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Gasoline prices hit an all-time high in this Spring, and forecasters are predicting more records for the summer. The American Automobile Association (AAA) says gas demand could be up 1.6 percent for the year. Given the already strained refining capacity in America and foreign countries—especially in the volatile Middle East—tightening their production output, pickup truck owners will not get a break at the pump.

High gas prices usually lead to a lot grumbling and complaining, but very few motorists will change their driving habits or switch to a more fuel-efficient vehicle. One recent survey noted that gas would have to stay at $2.75 a gallon for six months before just five percent of the survey’s respondents would purchase a different vehicle.

Economists say high gas prices don’t shock the pocketbook as hard compared to price spikes when the first oil embargo hit this country in the early ‘70s. Today, gasoline prices are a much lower percentage of our disposable income. When you factor in inflation, gas prices are quite reasonable. And when you compare the cost of American gasoline to petrol in Europe, we have quite a bargain.

But gas prices do play an important role in the psychology of the average American, and that’s why high prices can shake consumer confidence. So if gas prices do go up dramatically this summer, expect the topic to be heavily debated during the presidential campaign.

Most truck owners don’t have a choice: They need their heavy frame and gas-slurping V8 for work or favorite recreation. But few motorists really know what goes into their tank. There are numerous myths and misconceptions about gasoline. So PUTC has compiled and answered some of the more frequently asked questions about gasoline:

What is gasoline and how is it made?
Gasoline is a liquid mixture of volatile hydrocarbons. Petroleum crude pumped from below ground can be refined or distilled into a variety of hydrocarbon products, ranging from lightweight methane gas to heavyweight asphalt. Gasoline is produced by combining middleweight hydrocarbon products, and then mixing in chemical additives to achieve desired performance levels. Diesel fuel is made from slightly heavier hydrocarbons.

Does gasoline really come from dead dinosaurs?
A likely theory on the origin of petroleum focuses on organic matter—mostly vegetable but some animal—decomposing under heavy pressure and the absence of air over millions of years.

What is octane?
The octane number or grade measures a gasoline’s ability to resist detonation and/or spontaneous ignition. The higher octane number, the more resistance to detonation.

What is detonation?
Also known as pinging or knocking, detonation occurs when there is abnormally high pressure in the cylinder, forcing the piston backward against its will on the compression stroke. A pre-ignition condition has a slightly different cause and more destructive results, but the knocking noise is the same. Both can lead to significant internal engine damage.

Okay, what does the octane number mean?
The original reference point came in the early 1900s when 87 octane gasoline was a blend of 87 percent iso-octane and 13 percent heptane. Gasoline formulas and octane rating methods have changed dramatically since. Now called the Anti-Knock Index (AKI), this is the octane number posted on the pump by law. Generally, three grades are available: 87 (sometimes called regular), 89 and 91 (sometimes called premium). The numbers themselves mean little to the average consumer, but every driver needs to be aware that all vehicles require an adequate grade of gasoline.

What is the proper grade of gasoline for my vehicle?
Check the owner’s manual first and be sure that the recommendation is listed as an Anti-Knock Index number. Some foreign car manuals may indicate a Research Octane Number (RON), which is higher than the AKI. As a quick rule of thumb, you can subtract 5 from the RON to get the AKI. The recommended grade should be adequate for normal driving, but if you hear a pinging or knocking noise, step up a grade immediately. You should also purchase a higher grade when carrying or towing heavy loads, driving to a hotter climate or traversing mountain ranges as a precaution to knocking.

Can I mix different octane grades in my tank?
Sure. In fact, some gas stations have just two underground tanks and mix the middle grade in the pump before it goes into your truck. Whether mixing your own petrol cocktail is economical depends on the prices. The cost of 89 is usually halfway between 87 and 91 anyway.

Will my truck run better if I step up to 91 octane?
Not necessarily. Quality fuel will not heal a sick engine or improve fuel economy. A truck manufacturer may recommend high-octane fuel because the engine is designed to run on premium. If the manufacturer recommends 87 octane, then use it until you detect knocking. Giving your truck premium fuel is not the same as eating health food in place of sugar snacks.

Are all gasoline brands alike?
No. The actual composition produced at different refineries in the country can vary, even within the same brand. Formulas are different for each climate and season. Additives, such as detergents, are different between brands. Laws are different for each area of the country regarding oxygenated gas to help improve emissions. Even the way wholesalers, transporters and gas station operators store and manage their stock can make a difference. It is possible to get a bad batch of gasoline. When you find a brand and station that suits your needs, stick with it.

Why do gas prices change so much?
Simple economics of supply, demand and competition. Gasoline prices not only depend on the cost of foreign crude oil, taxes, refinery costs and capacities, inventories and supplier/dealer profit margins, but intangibles such as world events, financial markets and environmental regulations. Local gas stations are independent operators and set their own prices based on local competition, real estate rents and labor costs. Some speculation is necessary because the current pricing has to pay for the next delivery of gasoline.

Why does gasoline cost so much?
Compared to other consumer liquids, gasoline is a bargain. Bottled water sells for about $4 a gallon, mouthwash is around $18 a gallon and cold medicine is close to $180 a gallon. Adjusted for inflation, the real cost of gasoline is less than what it was 30 years ago.

What are ethanol and methanol?
Ethanol is an alcohol fuel derived from corn and methanol is derived from natural gas. Both burn cleaner than gasoline but aren’t cost effective for general consumers. Mixed with 15 percent gasoline, ethanol (called E85) and methanol (M85) can be used in a Flexible Fuel Vehicle (FFV).

What is a Flexible Fuel Vehicle?
The engine in a FFV automatically adjusts between gasoline and other fuels such as E85 and M85. Major vehicle manufacturers have FFVs for sale, sometimes at a lower cost than gas-only models because of tax breaks. Alternative fuels costs more, are harder to find and may offer lower fuel economy. The upside is a cleaner burning vehicle, and sometimes there are tax advantages and HOV-lane privileges.

Why do diesel engines get better fuel mileage?
The diesel cycle is inherently more efficient than the “Otto” cycle used in gasoline engines. Diesel fuel is also heavier and contains more energy. But diesel engines do not accelerate well, are extremely noisy and pollute more. Those conditions are quickly changing as government regulations will soon force diesel engines to run almost as clean as current gas engines.

My grandfather says he put mothballs in his gas tank to make his car run faster. Does that trick still work?
No. It’s true that gasoline formulas in the ‘40s retained some oxygen when mothballs were dissolved in the tank. This additional oxygen might have compensated for a rich fuel condition in the engine and improved performance. Today’s fuels and engine-management systems are so sophisticated that mothballs will not make any difference, except possibly to clog up filters.

Should I use over-the-counter additives?
Gasoline already has a high dose of chemical additives to keep fuel injectors and valves clean under most driving conditions. If an engine has been diagnosed with dirty injectors, then an over-the-counter additive may help. As mentioned before, gasoline brands are different, and certain driving conditions may lead to injector deposits that are not cleaned by the additives in the driver’s regular gasoline choice.

How long can I store gasoline?
About six months if the gas is stored in a sealed metal container and placed in a cool location. A gasoline has deteriorated if it has a fowl smell, is cloudy or shows signs of separation.

How does the nozzle at the end of the hose on the gas pump know when the tank is full?
A small hole is located near the tip of the nozzle, and from there a small tube leads back to a check valve in the handle. When fuel reaches the tube, the check valve releases the handle.

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