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Posts Tagged ‘Fuel Prices’

We’re less than a week into the NFL lockout where billionaires are arguing with millionaires about compensation and now there’s whining reports from players who say they can’t afford health insurance premiums.  Normally, teams pay for that but during a work stoppage each player is responsible for their own coverage.  And under the federal COBRA law it allows employees to continue coverage at their own expense where the average monthly fee for a family policy is about $2400.

So we have a group of players whose average salary is approaching $2M and where a minimum rookie salary was $320K last season… is “worried” they can’t pay COBRA over a long term?!  This is utterly preposterous.  Many of us are worried about paying for the next tank of gas so welcome to the real world NFL players!

And speaking of fuel prices, are you ready to pull out larger bills from your wallet for even higher prices due to the imminent delivery of boutique fuel called E15?

Here’s the background:  Growth Energy, an ethanol industry trade group, petitioned the EPA in March 2009 to raise the limit on ethanol in gasoline from 10 to 15 percent. Several engine product and auto manufacturers as well as others urged EPA to be deliberative in its review process, and do adequate testing to assure that E15 would not harm existing products or pose safety risks. Despite the fact that E-15 blends were proven to cause engine failures from overheating as well as emission increases and emission (durability) impacts and material compatibility issues, in October, 2010, the EPA approve higher levels of ethanol (E-15 or 15% ethanol) in gasoline for use in only 2007 and newer automobiles. It seems that scientific facts were ignored.  Not the first time the EPA has ignored facts.  Remember the Uniroyal/Alar truth?

At any rate, motorcycles are exempt from E15 use, but there is significant risk that consumers will unknowingly or mistakenly put E15 in motorcycles (“misfueling”).  Since we’re all smart and would never knowingly misfuel our precious ride, the more likely case is where fuel retailers are not prepared to offer both E10 and E15 at their stations, and given the choice, will likely opt to offer E15 only.  I don’t know about you, but in my motorcycle travels across Canada and the western U.S., there were many stations ill equipped to accommodate an additional fuel.  This would then lead any business to choose between E15 and E10 fuels – and E15 will win out since it’s more profitable for them to carry for automobiles and motorcyclists will have no choice but to fuel with E15 and suffer the mechanical consequences.

You might think the EPAs got your global warming back, but the agencies prior experience with fuel transitions isn’t stellar.  In 1974, as the EPA led the transition to unleaded fuels, the Agency reported a misfueling rate of 15 percent over ten years after the introduction of unleaded gasoline.  We’ve all seen the reports of station attendants fueling diesel in non-diesel automobiles which resulted in huge expense so it happens.

It turns out the Outdoor Power Equipment Institute (OPEI) has recently filed an E-15 Partial Waiver Legal Challenge to request that the EPA, consistent with prior precedent, ensure continued consumer choice by requiring the continued sale of gasoline blends of no greater than E10 fuel.  Clearly the potential of reduced volume of E10 fuel in the marketplace will likely result in the elimination of supply, and/or increase the price of what little there is available for motorcycle fueling.

Photo courtesy of Growth Energy.

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I want to do my part and help fill our highways with motorcycles in route to Street Vibrations, but it got me thinking about fuel prices especially after hearing reports of price gouging from Hurricane Ike.

As Reno readies the welcome mat and bikers roll into town from all over the Northwest for the 14th year of this four-day event – crammed with just about anything for a motorcycle enthusiast – and has events spread all over Humboldt and Lander county – I wonder how many people will pass on the event because of fuel prices?

Reports state we consume 400 million gallons of gasoline every day in the U.S. and the demand for gas has pushed gas prices to record highs.  My trip to the 105th Anniversary celebration consumed approx $270.00 worth of fuel as Premium fuel averaged a little over $4 a gallon which is less than the current west coast prices. 

I don’t know about you, but I subscribe to the theory that market speculators have fueled the run-up of gas.  Reminiscent of the Enron debacle the commodity trading of large index investors and “swap” traders who trade on behalf of banks or wealthy individuals got into the futures markets which includes crude oil.  Large investors poured $60B into the oil market during the first 5 months of this year then by the end of July pulled out $39B as oil prices declined.  Is it coincidental that the speculation had such a dramatic effect on prices?  I think not!

And speaking of Nevada even the brothel business is down 25 percent which depends on truckers and they have felt the pinch of high diesel prices more so than anyone. So bad is the business that the Shady Lady Ranch is offering gas cards to lure truckers in, and even the Moonlite Bunny Ranch has offered up a deal called “double your stimulus” for those folks who have yet to cash their federal tax rebate checks.  Clearly the price of fuel has had an impact…

I’m not going to let gas prices stop me from getting a bit more “seat time” on the way to Reno, but this sign pretty much sums up my feelings on prices…

Photo courtesy of Flickr/Casey Helbing

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