$10 gallon Avgas

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rv7charlie

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Initial estimates are an additional ~$1.00 per gallon over 100LL based on oil being $40/barrel with the price increasing proportionally with higher oil prices.
Can you support this with actual data? Or with simple logic? If he said it would cost the consumer ~$1/gal more, that logically would be due to the chemical additives and any excess processing costs associated with blending it. If *those* costs increase, then sure, the price would go up proportionally. But only greed would make the spread go up just because the price of a barrel of oil goes up. And I suspect that their marketing people would see it as counter-productive to do that; if the dollar spread stays stable or goes down, it becomes more competitive with avgas purely on price, as avgas prices go up.
 

Vigilant1

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Price of anything is ultimately set by demand for it relative to demand. That's it. Not greed, not avarice, not good intentions. The cost of production (including capital, labor, raw materials, processing, transportation, etc) relative to other uses for capital, labor, etc just determines how much will be made of the product. If the cost of production exceeds the price that the market will support, then zero of it will be made.
 
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tspear

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Can you support this with actual data? Or with simple logic? If he said it would cost the consumer ~$1/gal more, that logically would be due to the chemical additives and any excess processing costs associated with blending it. If *those* costs increase, then sure, the price would go up proportionally. But only greed would make the spread go up just because the price of a barrel of oil goes up. And I suspect that their marketing people would see it as counter-productive to do that; if the dollar spread stays stable or goes down, it becomes more competitive with avgas purely on price, as avgas prices go up.
There was a video a while back where George explained it. From memory, almost everything required for G100UL are in production in many refineries already. There are/were a few components which will have to come from a chemical plant. Since, what is unique about G100UL is the formulation, it doe NOT have any new chemical components. This makes predicting the range fairly simple using existing market prices. And how those prices relate to the current price of crude oil (for which is the super majority of the base for all parts of G100UL gives a pretty descent range,


Tim
 

Vigilant1

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unless it's another FAA protected monopoly. .....sort of like DPE's getting $1k for a check ride.
Ultimately, that's still supply and demand, right? The FAA restricts supply, demand is relatively inelastic even at high prices, so that's the price we pay.
 
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Turd Ferguson

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Can you support this with actual data? Or with simple logic? If he said it would cost the consumer ~$1/gal more, that logically would be due to the chemical additives and any excess processing costs associated with blending it. If *those* costs increase, then sure, the price would go up proportionally. But only greed would make the spread go up just because the price of a barrel of oil goes up. And I suspect that their marketing people would see it as counter-productive to do that; if the dollar spread stays stable or goes down, it becomes more competitive with avgas purely on price, as avgas prices go up.
That was the PR blurb I read. I thought it interesting as apparently some or all of the blending components are derived from petroleum.
 

Vigilant1

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This isn’t “actual data” but here’s what GAMI’s FAQs have to say:
View attachment 129476
I think we will have to wait and see.
That's a very practical answer. As I read it, they are telling us that the cost of production (through the point that it leaves the production facility) is estimated to be 60-80 cents per gallon higher than 100LL at that same point (when crude is priced at $40-$60 bbl. Presumably, if the constituents of their new fuel largely petroleum based, the cost differential from 100LL would go up proportionately). If we have a healthy market, retailers will try to maximize their profit (which is not the same as maximizing the price per gallon). Consumers will try to minimize their costs. Together, we'll establish a price.
 

SpruceForest

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I do love the greed argument... especially when refiner profit is routinely 1/2 to 2/3 of the Fed excise tax (assuming you are not a fractional operator). On oil prices, we have not seen the loss of Russian oil plugged into global prices yet, so $170/bbl could be in our future, which may be what is needed to decree the end of US crude and refined product exports, thus decoupling the US market from the global with exception of pass-thru refining. The good news is that refineries in the US are incredibly efficient, with the bad news being that markets still tend towards efficiency as well, despite efforts to the contrary.
 

TXFlyGuy

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I do love the greed argument... especially when refiner profit is routinely 1/2 to 2/3 of the Fed excise tax (assuming you are not a fractional operator). On oil prices, we have not seen the loss of Russian oil plugged into global prices yet, so $170/bbl could be in our future, which may be what is needed to decree the end of US crude and refined product exports, thus decoupling the US market from the global with exception of pass-thru refining. The good news is that refineries in the US are incredibly efficient, with the bad news being that markets still tend towards efficiency as well, despite efforts to the contrary.

Factor in the upcoming energy crisis in the UK & Europe this winter, and the China - Taiwan situation, $170+ oil may very well be a reality.

Note: Germans are buying up firewood as fast as they can, in fear of no gas or heating oil this winter.
 

rv7charlie

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This isn’t “actual data” but here’s what GAMI’s FAQs have to say:
View attachment 129476
I think we will have to wait and see.

That sounds like data. ;-) if the vast majority of the components are directly derived from petroleum stock, then prices should more or less track petroleum prices. But remember, there's still the fact that eliminating the lead is going to reduce handling/transportation costs significantly, and the 'total cost of ownership' issues around maintenance and engine life.
 

mikoman

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This isn’t “actual data” but here’s what GAMI’s FAQs have to say:
View attachment 129476
I think we will have to wait and see.
Well I wonder how much California has to do with that, trying to ban fuel etc. hey we have this new fuel and you will have to put up with it nothing else available,this is what we are charging so take it or leave it as the saying goes. No disrespect to any company trying to come up with this a business plan to see the need, develop their product and bring it to market before FEDS change their mind/specs. Hopefully as it gravitates to the whole USA won't be much more pricey than our usual av-gas. but then again 90% of our emission crap is from what California demanded. Still by volume I would bet my area of Chattanooga TN sells more auto gas in a week than the whole Cessna-Piper contigint uses all year. With our small volume-consumption we use in aircraft I don't think it will ever match what we pay at the pump.
 

mcrae0104

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there's still the fact that eliminating the lead is going to reduce handling/transportation costs significantly
Honestly, I don’t know much about petroleum production and distribution. Do we expect G100UL wouldn’t need to be segregated the same way as 100LL (which I imagine has separate production equipment & distribution requirements) and it’s therefore kind of like any other unleaded blend? I know a petro engineer at a local refinery; I’ll have to pick his brain about this next time I see him.
 

TXFlyGuy

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So when will this new wonder-fuel be available, at every FBO nationwide? Is this a matter of months? Or years?

Will this require new storage tanks, and/or new plumbing? Will the EPA allow leaded and UL fuel to use the same system?
 

TerryM76

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It’s true, DPEs can charge $1k for a check ride. The FAA isn’t involved in the price structure for any testing performed by DPEs or DMEs. The only guidance we are given is to charge a “reasonable fee”. It’s definitely a good idea to shop around though.
 

Bigshu

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eliminating the lead is going to reduce handling/transportation costs significantly,
Maybe, maybe not. The volume transported has a big impact on transportation in a pipeline. The fact that contamination will be minimized is nice, but we used to pump a lot of avgas from Phillips, and other than some dye flags and strict rules on batch cuts, it was like anything else, the more barrels you put in system in a batch, the better the break you get for it. Boutique fuels like this will struggle to make minimums for batch size and will likely still be transported by trucks on "milk runs" like Swift does with UL94, until they ramp up. Back when we handled 100LL, we had to dedicate two tanks to it, for batch size as well as QC reasons, and it was a nuisance to handle on the tank farm. We were glad when Phillips built a terminal down the street and took their avgas business in house.
 

Brünner

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Price of anything is ultimately set by demand for it relative to demand. That's it. Not greed, not avarice, not good intentions. The cost of production (including capital, labor, raw materials, processing, transportation, etc) relative to other uses for capital, labor, etc just determines how much will be made of the product. If the cost of production exceeds the price that the market will support, then zero of it will be made.
If that were true then the price of regular gasoline would be higher than avgas, considering the much larger fleet of cars and trucks compared to the piston-engine aircraft fleet. But it doesn't seem to be the case.
 
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