If you’ve noticed a widening gap between the price of regular and premium gasoline, you’re not imagining it. premium gas are becoming disproportionately more expensive. Sadly, there doesn’t necessarily have to be a specific cause for the problem — Russia’s War in UkraineThe impact of environmental regulations and limited refining capacity both seem to be factors, meaning a quick fix is unlikely.
Bloomberg report that the average price difference between regular gas and premium gas is now about 75 cents in the US, 15% higher than this time last year. At least it’s not as bad as it is in the UK, where the difference between premium and regular petrol is 25% higher than it was a year ago. And chances are things will only get worse as we head into summer.
“Currently high levels of seasonally high octane values do not bode well for a smooth transition to summer spec gasoline,” said Callum Bruce, an analyst at Goldman Sachs. speak Bloomberg.
Bans on Russian petroleum imports by sea mean less naphtha, a vital part of gasoline production, is transported. In addition, U.S. Tier 3 regulations require gasoline to contain less sulfur, but manufacturing low-sulfur gasoline lowers the octane number, making high-octane premium fuels more expensive. should be more expensive.
“Meeting lower sulfur requirements comes at the expense of octane levels, which can contribute to higher prices for high-octane blend ingredients. This momentum will continue into 2023 and could lead to a similarly explosive gas price hike this summer,” Bank of America recently noted.
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If there’s any good news here, it’s that RBN Energy analyst Robert Auers believes the biggest problem is the lack of refining capacity. And as new refineries are due to start operating later this year, we could see a spike in gasoline prices from regular to premium gasoline starting to fall. But for the time being, be prepared to pay a little more if your car needs a premium.
