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Great Lake Crack shows rough refinery economics (c)howard weil
As a few gas stations in the Midwest were quickly nearing the unthinkable 99 cents for a gallon of gasoline mark, the excitement of finding below-$1 gasoline was starting to build around the country. The national average for retail gasoline prices has fallen over a $1 per gallon since July of 2015. This coincided with the price of crude dropping over 50% in the similar timeframe. Refineries have been excited to take advantage of cheap crude prices. But as crude prices have ran out of room to fall much further, refined product prices have continued to plummet. High gasoline inventories, especially in the Midwest, have forced prices to plummet at the pump. As Midwest refiners are selling their refined products, such as gasoline, for less and less each week, the profitability of these refineries continues to dwindle. The economics have gotten so bad that some Midwest refiners are opting to slow down production to limit financial losses.
A weekly ritual for some energy analysts is to observe the previous week's wagers made by oil investors. The data can be found on the US Commodity Futures Trading Commission's weekly report which since 2006 has served as a catalogue of total interest in crude.
The Energy Information Administration released its weekly report today on the status of petroleum inventories in the United States.

Here are some highlights:

Crude oil inventories decreased by 0.8 million barrels (MMbbl) to a total of 502.0 MMbbl. At 502.0 MMbbl, inventories are 84.0 MMbbl above last year (20.1%) and are well above the upper limit of the average range for this time of year.

Gasoline inventories increased by 1.3 MMbbl to 255.7 MMbbl. At 255.7 MMbbl, inventories are up 13.0 MMbbl, 5.4% higher than a year ago. Here's how individual regions and their gasoline inventory fared last week: East Coast (+1.1 MMbbl); Midwest (+1.6 MMbbl); Gulf Coast (+0.1 MMbbl); Rockies (-0.9 MMbbl); and West Coast (-0.6 MMbbl). It is important to note which regions saw increases/decreases as this information likely drives prices up (in the case of falling inventories), or down (in the case of rising inventories).

DISTILLATE (diesel, heating oil) INVENTORIES:
Distillate inventories increased by 1.3 MMbbl to a total of 161.0 MMbbl. At 161.0 MMbbl, inventories are up 29.8 MMbbl, or 22.7% vs. a year ago.

You asked for it, so you got it! GasBuddy announced a new feature today that allows drivers to find the closest station offering E85 (a fuel blend of up to 85% ethanol and 15% gasoline), as well as report and compare those prices.

Check it out in the latest version of the app

In addition to the fact that there are over 3,500 stations in the U.S. offering E85, and over 17 million flex-fuel capable vehicles on the roads, growing GasBuddy demand for the feature could no longer be ignored. We have been getting request from our social media challenges and via our support desk! 

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What’s the single question that Fortune, Forbes, CNN, CBS News, Barron’s and are all asking?   Is the U.S. economy heading into a recession?

Google tell us that a few financial publications began to raise that question and succinctly addressed it beginning in the fourth quarter of 2015.  The subsequent consumer attention and media interest has simply extended a steady drumbeat, making the discussion a louder one.

Amplifying the chatter of recession has been the slump of energy stocks, sluggish demand figures for fuel, and the apparent failure of Brent and WTI crude oil to hold any upward price traction.  So... is the price of oil a leading indicator or a trailing one?

E85 is a renewable, corn-based blend of fuel that contains as much as 85% ethanol. It has become a rising star as the movement to become energy independent has gained momentum in the United States.

Since the Clean Air Act was signed decades ago, the country has been moving towards being more environmentally friendly. In 2005, President George W. Bush passed the Renewable Fuel Standard which required increasing amounts of renewable fuels to be consumed every year, billed as a way to cut pollution and reliance on foreign crude oil.

Currently, there were about 17.4 million flex-fuel vehicles on the road that are capable of using various types of ethanol blends. Flex-fuel vehicles are most common in the Midwest, where corn is a major crop and is the primary feedstock for ethanol fuel production, but have been quickly spreading across the country. Because of this, E85 fuel has been popping up in gas stations nationwide.

The cheapest gasoline prices in over twelve years are showing up in some lucky states in the heart of the nation, with previously unthinkable 99-cent gasoline becoming a strong possibility as wholesale gas prices plunge amidst growing supply.

GasBuddy reports that nine states in the nation are currently witnessing the lowest average gasoline prices since early 2004: Oklahoma ($1.37), Indiana ($1.45), Kansas ($1.46), Ohio ($1.47), Michigan ($1.49), Minnesota ($1.52), Wisconsin ($1.54), Illinois ($1.57) and North Dakota ($1.63) as oil refiners offer bargain basement prices to rid themselves of winter-spec gasoline ahead of a pending shift to cleaner burning fuel.
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After blogging recently about the history of radar detectors, I thought it might make sense to take a look at this history of speed limits in the United States.

Early speed limits in America’s history didn’t deal with cars.  According to The History Channel, in 1652 the colony of New Amsterdam (now New York) issued a law in stating that wagons, carts and sleighs could not be ran, ridden or driven at a gallop. Violators faced a penalty that started at two Flemish pounds.  While it doesn’t sound like much, those two Flemish pounds then would equal $150 now.  Slightly less than what a speeding ticker might cost you in today’s dollars.
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A recent CDC risk survey found almost 45 percent of teens said they had texted while driving during the previous 30 days.  And thankfully, Catherine C. McDonald, an assistant professor at the University of Pennsylvania School of Nursing and a principal investigator at the Center for Injury Research and Prevention at Children's Hospital of Philadelphia, became concerned about these statistics and decided to delve a little deeper.

She and a colleague, Marilyn S. Sommers, professor of medical-surgical nursing at Penn, recently published the results of their research and shared it with the Phila. Inquirer.  You'll be surprised to hear what they learned...
Another week, another decline at the gas pump for much of the country. Gasoline prices fell 6.2 cents in the last week, according to live data. Prices this morning stand at $1.733/gallon, some 25.6 cents lower than a month ago, and 44.4 cents under a year ago as crude oil prices struggle to rebound from recent lows.

No where in the country has the decline been as large as in the Midwest, where refiners, incentivized by running cheaper Canadian varieties of crude oil, have continued to churn out cheap winter gasoline. EIA numbers now show gasoline inventories across the country at their highest January (the latest information available) level ever, while the Midwest sees some of the highest outright supply levels in over a decade. The situation has caused some prices in the Great Lakes to fall to levels not seen in nearly a decade.
We may well get accustomed to these terrific, not seen in a generation, pump prices, but some careful and considered pundits are hinting, we shouldn't get too comfortable with them.
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Have you ever owned a radar detector?  Did it do what it was designed to do and help you avoid a speed trap?  I thought it would be interesting to take a look at the history of radar detectors.

According to, the first commercially available radar detector was on the market in the early 60s (who knew?).   In fact it was even featured on the cover of the September, 1991 issue of Popular Electronics.  This detector, known as the Radar Sentry, was made by a company called Radatron out of Tonawanda, New York.
According to a monthly report by Michael Sivak and Brandon Schoettle from the University of Michigan, the average fuel economy of newly purchased vehicles increased for the first time in eight months, The surprise increase comes due to a month-to-month decline in pickup trucks and SUVs, the report notes. 

The average fuel economy (window-sticker value) of new vehicles sold in the U.S. in December was 25.1 mpg—up 0.2 mpg from the value for December. Fuel economy stands down 0.7 mpg from the peak reached in August 2014, but still up 5.0 mpg since October 2007 (the first month of monitoring).

For a description of the calculations and the recent mpg values, click here.

California Governor Jerry Brown
Because of plummeting gas tax revenue Calif. transportation officials have announced plans to cut funding for road and transit projects by $754 million over the next five years, the greatest reduction in two decades.

And that may be just the tip of the iceberg. Lucy Dunn, chairwoman of the California Transportation Commisson warns of "even more draconian cuts next year" if funding sources under consideration by lawmakers do not improve transportation finances.

At the same time, the governor and many others recognize the need for more, not less investment, in roads, highways and transportation infrastructure.  So where do you think the needed money is going to come from?

Another day, another headache for popular ride-sharing mobile phone application, Uber. It seems Uber has been in the headlines frequently as of late, battling a new city council each time. The latest public battle is occuring in Austin, TX. Austin hosts the annual SXSW festival, where tech companies travel to party, pitch, and partner with other like-minded techies. With a city that has embraced the tech movement as much as anyone, save Silicon Valley, it’s curious now that the city council would be in a heated debate with Uber. The city council’s requirement for Uber to force drivers to abide by city fingerprint and background testing rules was met with fierce opposition by Uber. 

While Uber is busy fighting municipalities to discourage additional ride-share regulation, a new storm is brewing that Uber will have to address. This time it may impact logistics around America’s most beloved sporting event: The Super Bowl.
"Consumers working together to save on gas"