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Re: Thoughts

To: "Klauser, Felix (EXP)" <felix.klauser@lmco.com>
Subject: Re: Thoughts
From: David Scheidt <dmschei@attglobal.net>
Date: Tue, 13 Sep 2005 21:11:55 -0500
Klauser, Felix (EXP) wrote:
>>This will sound strange, but the premium for premium gasoline is
> 
> actually
> 
>>shrinking.  Think about it.  When gas was $2.25 for regular, mid grade
> 
> was
> 
>>$2.35, and premium was $2.45.  That's a $0.20 difference (which comes
> 
> out
> 
>>to being about an 8.88% price premium for premium gas).  Now that
> 
> regular
> 
>>is $3.00, midgrade is $3.10, and premium is $3.20 - well the gross
> 
> premium
> 
>>for premium is the same per gallon ($0.20) - but the percentage is
> 
> 6.66%.
> 
> 
>>So, if octane boosters were too expensive to boost octane when gas was
>>cheaper, they are definately too expensive to boost the octane now.
> 
> 
> Umm, I don't agree. For a given quantity of gas (let's say 10 gallons)
> premium still costs 20 cents more per gallon. And regardless of the
> price of the gas it still needs to same amount of octane booster which
> presumably costs the same (for now!). So the cost comparisons that
> worked before are still accurate now.
> 

Premium gasoline is not regular gasoline with "octane boosters" added. 
It's different stuff.  Well, the octane booster is usually, wait for it, 
isooctane.  But it's not some magic stuff.  It costs more, because the 
yield per unit of crude is lower.  (Premium gasoline usually has other 
things added to it, other than just iso-octane.  Detergents and deposit 
control stuff are usually present in higher levels than regular 
gasoline, but they're not required to.)






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