*****despite rising gas prices, midgrade and premium fuel remain about
10 and 20 cents extra per gallon, respectively. One unexpected finding: Despite the hike remaining constant all these years, more drivers may now be ditching pricier fuel for the regular stuff.
It?s a bit counterintuitive. Proportionally, premium gas costs 6% more than regular today. In 1995 it cost 17% more, according to EPA historical data. As prices rise, it would make sense for the extra cost of premium fuel to seem comparatively smaller. *****
Certainly dealing with averages is tricky since there is such wide pricing variability. But, before i found that one blurb i posted, I had looked around at google image search pics of 'gas station signs' and noticed that it did seem the 5%-8% or so differential around here was less than some historical prices. That is, if reg. is $1.00, mid $1.08 and premium $1.16 - that's 16% more for high octane. BUT if the numbers are $4.00 reg, $4.15 mid and $4.30 premium - it's only 7.5% more to run premium. Of course, if your car's manual doesn't recommend premium, it's of no benefit, but both of my cars call for it.
It's occurred to me too that the relative price difference between regular (87) and premium (93) is smaller than at any time I can recall. Both my Subarus (04 WRX and 06 OB 3.0) call for 91 (OB may be
90, but that's insignificant). 91 and other mid-grades are typically the worst alternative (cost-wise, since they're usually priced only a couple of cents less than. I think that's the money-maker for a lot of stations (who are really being squeezed now between high wholesale costs and driver's who think the stations are raking in profits as prices rise). People see a requirement in the manual for 91 and buy
I usually use 93 for 2 of every 3 fillups and 87 on the 3rd, but depends on the amount left in the tank. I try to keep the overall mix in the tank in the range of 90-92 octane at the best overall price. Hardest part is convincing the wife to use premium at all (the 6 is hers) since she can't tell the difference.
On a related issue, why are we still using (and it seems to be throughout the US) a decimal in gas prices? Nothing else is sold at retail this way, but every gas price is xxx.9 per gallon. Why can't this be simplified and rounded to the nearest penny? How did we get stuck with this ridiculous "tradition".
I was told years ago when I worked at a gas station that the .9/gallon was a tax levied at some step in the refining/distribution process. I've never been able to verify that. Presumably it must be a federal tax of some sort since this happens across all 50 states. In another sense, it seems to be the same sort of advertising tactic as making a big deal out of a $1.99 price instead of $2.00 for the same item... ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
No. It has NOTHING to do with taxation. It has to do with bulk pricing. hen you buy , say 100 liters (or 100 gallons) of fuel and the price is 1.29 per "unit" the fillup costs $129. In order for them to raise the price of a "unit", the smallest increment would amount to a full dollar for your 100 "units". Using the decimal pricing, the price can be raised or lowered in increments of TEN CENTS per hundred units instead of a dollar.
It is not a big deal perhaps, when buying in gallons, but when buying liters it really makes a lot of sense.
It made a lot of sense with gallons too, when gasoline was $0.25 per gallon. Imagine if the smallest price change that could be registered was 4%!!!!.
It seems unlikely the bulk pricing would ALWAYS lead to a retail fraction of 9/10 . There seems to be a lot of folklore, multiple reasons behind the initiation and continuation of the practice. Plus, some efforts to do away with the fractional pricing. (it is, after all, impossible to purchase a single gallon at the advertised price due to rounding)
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