No I am no talking about fashion. If you ever saw me dress you’d know that I do not follow current trends. The blends that I am talking about are “designer” gasoline blends that are required depending on where you live. First some background from the General Accounting Office,
“The Clean Air Act, as amended, requires some areas with especially poor air quality to use a “special gasoline blend” designed to reduce emissions”
“when different octane grades and other factors are considered, there were at least 45 different kinds of gasoline produced in the United States during all of 2004.”
I happen to live in one of those areas with “especially poor air quality” and each summer have to look forward to higher gasoline prices once the designer blend requirement kicks in. I do have a problem with how regulators cherry pick monitoring stations to determine that I live in an area with poor air quality, but that is not what this article is about. What should be on Page 1 of the newspapers and be screamed on the local news stations is that the Clean Air Act is being further used to raise the price of my summer blend.
New rules for gasoline refineries are going to force at least three to close in Philadelphia where the blends are made. Rather than try to comply with the rules companies are just going GALT. What we know about basic economics is that when the supply goes down and the demand increases (as it does in summer), the price must increase. Unfortunately like the sheeple that we are we have gotten used to paying $3.50/gallon or more for gasoline so the increase will likely be accepted passively.
The kicker is that we may not actually have any fuel to buy,
“the unique summer blend gas required in the region — which is mandated in only two other places in the country, East Texas and southern Maine — “puts Pittsburgh in a precarious position during the summer gasoline season, from both a supply and price standpoint…There is limited availability of production capacity to produce” Pittsburgh-specific gasoline, “especially with additional Philadelphia refinery closures,”
Oh there is one solution available…we can use the same blend as Philadelphia though that costs a lot more to produce. Someone please explain to me how a story about looming, significant price hikes in gasoline prices and the very real potential that there will be shortages is not headline news…PAGE 1 NEWS!