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Gasoline Toolkit

Topics

Why Does Gasoline Cost So Much?

How High Will It Go?

How Do I Calculate My Mileage?

Stretching Your Gasoline Dollar

Hunting for Low Gasoline Prices

Is It Worth the Drive?

Safe Fueling

Getting Your Money's Worth

Local Gasoline Prices


Why Does Gasoline Cost So Much?

Gasoline is made by processing or refining crude oil.� The cost of gasoline is shown in the following table:��


Cost Component
Dollars per Barrel Cents per Gallon Percent of Pump Price
Crude Oil Price $ 90.00 214.3 70%
Transportation to Refinery $ 2.00 4.8 2%
Refining Costs $ 4.00 9.5 3%
Refining Margins $ 5.00 11.9 4%
Transportation to Market $ 2.75 6.5 2%
Marketing Costs $ 2.25 5.4 2%
Marketing Margins $ 5.00 11.9 4%
State and Federal Taxes* $ 18.27 43.5 14%
Pump Price including Taxes $129.27 307.8 100%

* National Average and late October 2007 prices

The two largest cost components are crude oil and taxes which comprise about 84% of gasoline price.� In the United States taxes include both a Federal and State tax.� Both of these taxes are levied as cents/gallon rather than as a percent of price.� State taxes can vary considerably depending on the need and philosophy of the local government. The price of crude oil, which is 58% of pump price in our example, is a large factor in determining pump prices and in causing prices to fluctuate.� This relationship is illustrated in the plot of Gasoline and Crude Oil Prices.�

Please check the following sites for other viewpoints on gasoline prices:

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EIA's Primer on Gasoline Prices

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EIA's A Year of Volatility Oil Markets and Gasoline

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How High Will It Go?

PetroStrategies analysis indicates that increases in average U.S. pump prices are explained by the average cost of crude oil processed in a U.S. refinery (Refiner's Acquisition Cost) and the average utilization of U.S. refining capacity.�

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The formula used to make this forecast is based on historical data and has an R2 value of 0.9182.

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How Do I Calculate My Mileage?

One of the best things that you can do is to make sure that your car is getting the best mileage possible.

The next time you get a fill-up
Record the miles shown on the ododometer
which is located on your vehicle's dashboard. ---------->
(Remember the tank must be full)
The following time that you get a fill-up
Record the miles shown on the ododometer
which is located on your vehicle's dashboard. ---------->
Record the number of gallons that you purchased. --->
(Remember the tank must be full)
Record the price per gallon. -------------------------------->
The miles per gallon for your vehicle is:
Final odometer reading
Less initial odometer reading
Divided by the gallons of fuel purchased
Miles per gallon ------------------------------------------------>
The cost per mile for gasoline is:
Gasoline cost in dollars per gallon
Divided by the miles per gallon
Cost in dollars per mile ---------------------------------------->
">

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Stretching Your Gasoline Dollar�

1.�� Group your errands so you won�t have to make as many trips

2.�� Keep your car�s tires properly inflated

3.�� Avoid unnecessary idling of your engine

4.�� Coast up to red lights rather than accelerating and stopping quickly.

5.�� Avoid those jack rabbit starts when the light turns green

6.�� Obey the speed limit

7.�� Get rid of excess weight in the trunk

8.�� Keep your engine tuned

9.��� Replace air and oil filters regularly

10.�� Car Pool! Car Pool! Car Pool!

Other ideas to improve your mileage

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Gasoline Mileage Tips from the Department of Energy

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Best and Worse Passenger Car MPG Ratings

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Best and Worse Truck, Van and SUV MPG Ratings

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Hunting for Low Gasoline Prices

The following sites may help you find lower gasoline prices.

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GasBuddy.com

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GasPriceWatch.com

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Gasoline prices state-by-state

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Links to Gasoline Price Data for US Cities

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Is It Worth the Drive?

Before you start driving around town looking for the cheapest gasoline, calculate your savings compared to the costs of the extra mileage using the following calculator.

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Safe Fueling

Gasoline provides fuel for our mobile lifestyle in the United States. Unfortunately, the characteristics which make it a good fuel for car engines also make it a dangerous product.� Gasoline is highly flammable (burns easily) and very volatile (evaporates quickly). Our familiarity with gasoline often makes us unaware of its dangers.� The following cautions have been issued by fuel manufacturers and equipment providers.��

Smoking - Most people know not to smoke when fueling their car with gasoline.� These dangers also apply when filling your weed eater, lawnmower, chain saw and any engine using gasoline as a fuel.� Gasoline should not be used to clean hands or kill weeds.� Buy products designed for these uses. It is also a good idea to only use approved containers to store gasoline, do not overfill the approved gasoline containers, make sure they are stable when transporting and store in a safe area away from flames and children.��

Cell Phones - The Shell Oil Company recently issued a warning after three incidents in which mobile phones (cell phones) ignited fumes during fueling operations. In the first case, the phone was placed on the car's trunk lid during fueling; it rang and the ensuing fire destroyed the car and the gasoline pump. In the second, an individual suffered severe burns to her face when fumes ignited as she answered a call while refueling her car. And in the third, an individual suffered burns to the thigh and groin as fumes ignited when the phone, which was in his pocket, rang while he was fueling his car.

Cell phones can ignite fuel or fumes. Mobile phones that light up when switched on or when they ring release enough energy to provide a spark for ignition. Mobile phones should not be used in filling stations, or when fueling lawn mowers, boats, etc. Cell phones should not be used, or should be turned off, around other materials that generate flammable or explosive fumes or dust i.e. solvents, chemicals, gases, grain dust, etc.�

Static Electricity - Static electricity has been responsible for gasoline fires.� Bob Renkes of Petroleum Equipment Institute is working on a campaign to try and make people aware of fires as a result of "static electricity" at gas pumps. His organization has researched 150 cases of these fires.� There were 29 fires where the vehicle was reentered and the nozzle was touched during refueling from a variety of makes and models. Some resulting in extensive damage to the vehicle, to the station, and to the customer.� Seventeen fires that occurred before, during or immediately after the gas cap was removed and before fueling began.

Out of 150 cases, almost all of them were women!� Almost all cases involved the person getting back in her vehicle while the nozzle was still pumping gas.� The fire started from static electricity when the pump had shut off and she went back to pull the nozzle out.� Most men don't get back in their vehicle until completely finished which is why they are seldom involved in these types of fires. Most had on rubber-soled shoes.

Mr. Renkes stresses to never get back into your vehicle while filling it with gas. If you absolutely have to get in your vehicle while the gas is pumping, make sure you get out, close the door and touch the metal on the door frame, before you pull the nozzle out. This way the static from your body will be discharged before you ever remove the nozzle.

Pat Cabling who works at Chevron Texaco's Richmond Refinery offered these four simple rules for safe fueling.

1) Turn off engine
2) Don't smoke
3) Don't use your cell phone-leave it inside the vehicle or turn it off
4) Don't re-enter your vehicle during fueling

You might want to post these simple rules in your car so that everyone knows how to be safe when using fueling with gasoline.� Explain these rules to the new drivers at home especially.

According to an article on Snopes.com:

  • "Static electricity can cause fires at service stations: True

  • Static electricity was actually the cause of a number of gas station refueling fires: Undetermined"

While this article questions the validity of the sources of gas station fires, it also confirms that static electricity can cause fires.� The question seems to be in the data and research supporting cautions about cell phone use and reentering the car during fueling.

In our mind, if you believe that static electricity can cause fires, then you should avoid potential sources of static electricity.� This caution should apply to any devices that cause or could cause a spark including electrical appliances.

We also question any multitasking that prevents complete attention to the task of filling the fuel tank.� Spilling gasoline on your hands, clothes and car is certainly undesirable.� You should also be aware of other motorists who may be careless during fueling (spilling gasoline or smoking) and this means focusing on the task at hand.� Lastly, we would suggest that caution in handling volatile fuels may save you from a horrible consequence.

(Source: Static Quo,�Snopes.co)

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Getting Your Money's Worth

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Here are some fueling tricks from a 31-year industry pro who works for Kinder-Morgan Pipeline in San Jose, CA.

  1. Fill up your car or truck in the morning when the temperature is still cool. Remember that all service stations have their storage tanks buried below ground; and the colder the ground, the denser the gasoline. When it gets warmer gasoline expands, so if you're filling up in the afternoon or in the evening, what should be a gallon is not exactly a� gallon. In the petroleum business, the specific gravity and temperature of the fuel (gasoline, diesel, jet fuel, ethanol and other petroleum� products) are significant. Every truckload that we load is temperature-compensated so that the indicated volume is actually the amount pumped. A one-degree rise in temperature is a big deal for businesses, but service stations don't have temperature compensation at their pumps .

  2. �If a tanker truck is filling the station's tank at the time you want to buy gas, do not fill up; most likely dirt and sludge in the tank is being stirred up when gas is being delivered, and you might be� transferring that dirt from the bottom of their tank into your car's tank

  3. Fill up when your gas tank is half-full (or half-empty), because� the more gas you have in your tank the less air there is and gasoline evaporates rapidly, especially when it's warm. (Gasoline storage tanks have an internal floating "roof" membrane to act as a barrier between the gas and the atmosphere, thereby minimizing evaporation .)

  4. If you look at the trigger you'll see that it has three delivery settings: slow, medium and high. When you're filling up do not squeeze the trigger of the nozzle to the high setting. You should be pumping at the slow setting, thereby minimizing vapors created while you are pumping.� Hoses at the pump are corrugated; the corrugations act as a return path� for vapor recovery� from gas that already has been metered. If you are pumping at the high setting, the agitated gasoline contains more vapor, which is being sucked back into the underground tank so you're getting less gas for your money .

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Local Gasoline Prices

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Updated 01/19/15

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PetroStrategies, Inc.
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