With the falling price of oil has come a drop in the prices at the pump. It’s even a recurring topic in the news, how many more states now have an average price of under $2 a gallon. Even where I live, in NYC (usually higher than almost anywhere else), I filled up yesterday where it was $2.09 a gallon advertised - the cash price for Regular unleaded gasoline (87 Octane). Adjusted for inflation it’s the cheapest gas has been in over 20 years.
However, I noticed that the Premium fuel, at 93 Octane, was $2.69. That’s 50 cents more, when is about a 28.7% price premium to regular! And unfortunately, one of my two cars requires 91+ Octane.
I looked at the prices at other stations the rest of yesterday as I drove around, and that difference was everywhere.
Now back when gas was over $4 I’d also always seen the price difference as around 40-50 cents a gallon, which is far less as a percentage. Even a 50 cent gap of $4.20 to $4.70 would only be an 11.9% premium.
So what’s going on? I always thought the higher octane rating was something done in the refining process, based on the same crude oil, but the overhead of an additional process should be a linear factor (a percent multiplier), not a fixed cost difference of 50 cents a gallon?