Energy Tomorrow Blog
Posted May 16, 2019
Updated and new API standards that address the ethanol blended into the nation’s gasoline supply – developed in partnership with the Renewable Fuels Association (RFA) – will enhance the natural gas and oil industry’s ability to safely trade and/or ship its products.
Certainly, our industry has disagreed with RFA over policies and specific provisions related to the Renewable Fuel Standard’s mandates for increasing ethanol use in the nation’s gasoline. Even so, we agree on the need for technical standards to help ensure the safe transfer of products and work together to develop them.
Posted May 1, 2019
With summer driving season almost here, nationwide average gasoline prices were $2.88 per gallon as of April 30, according to the American Automobile Association, identical to what they were one year ago when adjusted for price inflation. This good news for consumers is due, at least in part, to record-breaking domestic oil production, which has put downward pressure on global prices for crude oil, the main factor in determining prices as the fuel pump.
While the current price may be the same when you pull up to pump, some notable things have changed behind the scenes.
Posted September 7, 2018
With the Trump administration considering a move that would push more E15 fuel into the nation's gasoline supply, API has a new ad warning that consumers could bear the risks of additional volumes of the higher-ethanol blend.
The ad touches on points we’ve made for years about the infusion of E15 (see here, here and here), spurred by the flawed Renewable Fuel Standard (RFS). The administration is thinking about facilitating the sale of E15 year-round. Currently, the Clean Air Act requires that E15 meet gasoline volatility requirements in the summertime. Key points in the ad: E15 can damage the engines and fuel systems of vehicles that weren’t designed to use it; nearly three out of four vehicles on the road today weren’t made to use E15; and automobile manufacturers have said using E15 could void car warranties.
Posted July 6, 2018
Earlier this week we looked at the summer variation in gasoline prices, due mainly to increased driving as well as fuel specifications that have added to the cost of gasoline. As the 2018 summer driving season approaches its midpoint, let’s check the data on gasoline prices and, separately, take a deeper look at why prices in any one state have tended to be higher (or lower) than the national average.
According to the American Automobile Association, the nationwide average price for regular gasoline was $2.85 per gallon on June 28, a decrease of 12 cents per gallon since May 28.
Remember, gasoline and diesel fuel prices tend to track the price of crude oil, because crude oil currently makes up more than half of the cost to make the fuels. The U.S. Energy Information Administration (EIA) reported that crude oil made up 56 percent of the price of gasoline in May, the agency’s most recent analysis.
Posted July 5, 2018
Every summer Americans take to the highways. It’s a big country with lots to see, and reliable fuels are fundamental to the uniquely American freedom to range far and wide. In 2017, Americans traveled nearly 8 trillion miles from April to August. As we load our cars with sports gear, picnic baskets and beach chairs, some tips from API downstream experts to help those fuels take you as far as possible – safely, all summer long.
Posted July 2, 2018
In previous posts (see here and here), we’ve discussed factors that have affected gasoline prices in the past. The cost of crude oil is chief among them, accounting for more than 50 percent of the fuel price. Some other factors are seasonal, and taxes imposed on each gallon of gasoline vary from state to state.
Posted June 14, 2018
With Wall Street Journal headlines such as “Trans-Atlantic Oil-Price Spread Soars as Supply Glut Disappears,” it might be hard to remember that the United States’ domestic oil production stood at a record 10.5 million barrels per day (mb/d) in April, and the nation’s petroleum trade balance is in its best position in 50 years. This has reinforced U.S. energy security, lowered the trade deficit and boosted economic growth.
That said, given our country’s much improved energy outlook, some may question why we’re still importing crude oil and refined products. And, while we’re still importing oil, why do we export domestic crude – especially when prices have risen at the pump? Why don’t we just keep American oil at home? ...
Answers are found in an understanding of basic market realities.
Posted May 31, 2018
In a recently released report, the U.N. Conference on Trade and Development digs into the factors that have made the U.S. energy dominance possible, and – specifically – the role of natural gas in energy dominance.
Posted May 24, 2018
Let’s add some needed perspective in the ongoing discussion of U.S. gasoline prices – even as Washington politicians try to exploit them for their own agendas. The latest political play: Senate Democrats want the president to cajole other nations into producing more oil to increase supply in hopes of moderating things at the pump.
Certainly, increasing global crude supply is important, because in the past doing so has put downward pressure on the cost of crude, the No. 1 factor driving gasoline prices.But, since we’ve seen how much lower and less volatile prices have been the past four years, thanks to the growth of U.S. oil production, wouldn’t it be smarter to encourage greater oil production here at home? Senate Energy Committee Chairwoman Lisa Murkowski
Posted May 22, 2018
Washington is known for partisan political skirmishing, so it’s not surprising that a group of Senate Democrats is trying to score political points against this year’s tax reform legislation by suggesting that lowering the corporate income tax rate has been linked to the recent rise in gasoline prices.
Let’s straighten them out on a couple of important things about gasoline prices, which have nothing to do with tax reform.
First, per-barrel costs for crude oil – the No. 1 factor in the cost of producing gasoline and diesel – have risen due to a tighter global oil supply/demand balance and lower inventories compared to last year. Second, with a strong economy, U.S. petroleum demand has run at its highest levels since 2007 and was up by more than 750,000 barrels per day in April, compared with one year ago. Next, as they do every year around Memorial Day, the start of the summer driving season, Americans are traveling more, which could raise demand further. Finally, although gasoline prices have increased recently, they’re still lower than where they were four years ago, largely because of increased domestic oil production.