Hey Howavi!

Started by Ghetto, June 29, 2014, 12:57:35 PM

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Ghetto

What's the deal with E85? How can one station have it for $2.75 a gallon and another $3.40?

Besides getting 80% of the mileage, what's the downfall?

Is most of the E85 gas made here in the US? All of it?
As long as we are keeping score, I've got something to prove

bigoil

E85 should not be that expensive, nor that cheap.

while the description denotes 85% Ethanol and 15% gasoline, it does vary slightly during the seasons to allow startability.

All of our ethanol is made in the US and in fact, the ethanol bought in this state 99% for sure came from here as we actually export ethanol to other states and other countries.

Our gasoline in the Midwest comes from US refineries and most of it utilizing Canadian crude oil. North East would be a mix of imported gasoline (Europe) and domestic from Glf and Northeast refineries, the latter relying the most on crude imports from the North Sea, Africa and Middle East.

Wisconsin Ethanol $2.20 * 85% = $1.87
Midwest Gasoline  $2.95 * 15% = $0.4425

Totaled = $2.3125 + .184 (fed tax) + .309 (state tax) +.02 (state inspection fee) = $2.825 Cost to the station. 20 cent margin should sell for $3.025 ish, which actually puts in line with the fuel mileage degradation of 15% (or 20% if that is your experience).

Why the variance? Wow, no idea to be honest but a couple of thoughts.

High Price: Gas stations sometimes have funny memories. WHen prices are rising, they are very quick to use replacement cost as a reason to raise prices but when prices are falling they look at inventory costs (the opposite of the former).

Low Price: Ethanol hasn't been much cheaper for a very long time but the only thing I can think of here is a station that locked in cheap ethanol prices and rather than capturing the increase in price is passing that onto consumers. If not, they are just plain losing money as a loss leader perhaps or won't be in business that much longer??




Ghetto

Thank you for the information.

It is very strange to see these different prices. Regular old gas never varies this much.

The cheaper station is a new Speedway that hasn't been open long. Maybe they are doing it just to get people buying it and will raise it soon.
As long as we are keeping score, I've got something to prove

bigoil

Quote from: Ghetto on June 30, 2014, 08:38:56 AM
Thank you for the information.

It is very strange to see these different prices. Regular old gas never varies this much.

The cheaper station is a new Speedway that hasn't been open long. Maybe they are doing it just to get people buying it and will raise it soon.

Bingo is his name-o. That said, don't be afraid to call out the high price seller