Higher Octane Gasoline on the Rise

The Energy Information Agency (EIA) released a report last week showing premium gasoline sales reaching levels not seen since 2004. At first glance, you might think this is related to the low prices at the pump; why not splurge a little and clean out the gunk in your fuel injectors? While that could certainly have something to do with it, the EIA says a bigger reason may be linked to rising standards for fuel economy.

The Obama administration passed laws back in 2012 requiring automakers to build fuel efficient vehicles starting as early as 2017. These cars/light trucks must average over 40 miles per gallon and that number continues on a graduated scale through 2025. Aside from tactics such as weight reduction, aerodynamics or building hybrid engines, automakers have been leaning in a different direction. Instead of the once popular V6 engine, auto engineers are using 4 cylinder engines and strapping on turbochargers. Turbocharging a smaller engine gives the ability to become more fuel efficient without sacrificing power. However, to prevent what is known as engine knock, engineers recommend using premium fuel.

Unless U.S. consumers spontaneously start buying electric vehicles, this trend should continue and, in turn, so will usage of premium fuel. The EIA is saying by 2025 over 83% of light duty vehicles will require turbocharged engines. What does that mean for you? Well about 30-40 cents per gallon, depending on what part of the country you’re in. Look on the bright side, gas prices are still about $1.50 less than three years ago.

Who is watching your fleet’s fuel prices? Are your drivers buying premium fuel when it’s not necessary, costing your company extra money? Do you have an idea of the industry’s best practices for controlling your fuel purchases? Contact Sokolis Group today to discuss ways to save time and money. There is always opportunity, no matter what the price of fuel is.

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