Category Archives: CNG Blog

Historical Gas and Oil Prices

What’s Causing Gasoline Prices to Drop?

The retail price at the pump is down by at least 70 cents per gallon in most every state from a year ago. In fact the price has dropped more than $1.00 in over 40 different states. So, what’s causing this drop in gasoline prices?

Gasoline prices are down because it is a distillate of oil so as crude oil drops so do the byproducts. The US imports millions of barrels each day and at the same time has almost doubled our crude oil production to roughly 9 million barrels a day. This adds more supply to the global markets and pressures prices to the downside. Another factor is the increased use of natural gas to produce energy (power plants, generators etc) that previously consumed oil leaving more supply available. In addition, Europe still hasn’t pulled out of its recession and struggles with a slow economy and consumes less oil which adds pressure to lower prices. Oil is part of a global market and every oil consuming region is affected by these factors.

How Low Can Gasoline Prices Drop?

In oil producing countries like the United States, the cost to produce oil is more expensive and the further oil prices drop below $70 a barrel their profit margins shrink considerably. This forces more and more US oil companies to stop production as the oil prices continue to drop. In addition, countries like Russia rely heavily on oil revenues to fund government services. When this revenue drops so do the social programs which can cause social unrest. These are typical reasons for world oil prices to move back up.

Consumers feel the relief at the pump and use the savings to drive more and to purchase items like large gas guzzling trucks. These reactions increase gasoline consumption and kick start the laws of supply and demand. The lower prices mean less gas tax revenue for individual states and could entice politicians to raise gasoline taxes higher. Which is why some experts see the price bottom at $1.75 where supply and demand forces balance out.

 

Gasoline and Oil Prices
Gasoline and Oil Prices

Gasoline and oil’s historical reaction to sudden plummeting prices takes about 6 months to recover and move back above $2.50 per gallon. Oil products like propane, gasoline, and diesel remain exposed to these volatile price swings and extended periods of high prices. Did you know that NGV fleets can negotiate below retail prices on natural gas for 5 years? This means they can guarantee that their price per gallon stays at $1.80 for 5 years.

When was the last time you saw stable gasoline prices for 5 years?  Get stability with CNG.

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Economic Impact of NGVs

The NGV industry has stimulated local economies while reducing harmful emissions. Over the last 2 years Florida spent $91 million dollars on private and public CNG fueling stations.  Read about the economic impact of NGVs and the many benefits generated through earnings and jobs created……

[gview file=”http://www.fuelforjobs.org/images/pdf/cngimpactstudy102.pdf”]

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Where Will Gas Prices Be Tomorrow?

Up or Down

 

We’ve seen a precipitous drop in gasoline prices since June 2014 which leaves everyone asking what will gas prices be tomorrow?  OPEC nations seem willing to wait out this drop and sustain losses in order to put other oil producers out of business.  See what the Washington Post has to say…..

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Train Runs on Dual-Fuel

Railway Minister Suresh Prabhu to launch first CNG train from Rewari tomorrow

Jan 12, 2015

NEW DELHI: In what could be considered as a milestone in adoption of green fuel in Indian Railways, the first CNG train will be launched tomorrow on Rewari-Rohtak section of Northern zone.

Who said it couldn’t be done.  Cars, trucks, planes and now trains are using flex fuel with CNG kits to reduce their use of expensive dirty diesel fuel.  This train conversion will reduce the diesel approximately 20% and use cleaner more affordable natural gas.  They feel this is another step to reducing their greenhouse emissions.

Railway Minister Suresh Prabhu from Rewari, a senior Railway Ministry official is leaning more towards alternative fuels in their train operations which will include solar and wind power.

The train will run 50 miles in 2 hours and run a mix of 20% natural gas with 80% diesel.  Earlier tests have been performed to show How CNG conversions work.

According to the official, there are plans to run more CNG trains in due course to reduce diesel consumption.

The train comprising of two engines and six passenger cars has been manufactured by Integral Coach Factory at Chennai with the CNG conversion kit being supplied by Cummins.

Development of a CNG conversion technology which will permit utilization of over 60 per cent CNG is also underway, he said, adding “switch over to LNG technology is also being planned as that will enable higher fuel carrying capacity.”

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CNG Conversion Fuel Mileage

Paratransit Van

CNG Fuel Mileage and Vehicle Performance

Fuel Mileage and Vehicle Performance have every thing to do with the BTUs in the fuel, the Technology built into the CNG Conversion System, and the CNG Kit Installer.

BTUs:  Natural gas carries higher BTU levels than gasoline due to ethanol and oxygenated fuel additives in the gasoline.

The energy content of liquid fuels like gasoline and diesel is dependent on the season and oxygenated fuel additives that reduce emissions. A summer gallon of gasoline will typically contain 114,500 British Thermal Units (BTUs), while a winter gallon has 112,500 BTUs. Blends with 10% ethanol and reformulations with MTBE both have fewer BTUs than pure gasoline. Summer blends for MTBE contain 112,000 and 10% ethanol blends only 110,210 BTUs (112,210 BTU’s in winter). Natural gas has 114,000 BTUs. The clear winner and most expensive is diesel with 129,500 BTUs. Because fueling stations don’t have to advertise that they are using a 10% ethanol mix in their gasoline, most don’t; however, most stations dispense this mix. Ironically, this means that in the summer, vehicles running on CNG more than likely receive 3,790 more BTUs than running the vehicle on gasoline and CNG costs 40% less. As for dual-fuel CNG diesel conversions, the mixture of natural gas with air in the cylinders creates a denser and more explosive reaction after the diesel is injected. Versus CNG diesel conversion system delivers more power and saves approximately 35 % in fuel savings.

Technology: The air fuel mixture will to a large extent determine the efficiency of your vehicle. CNG Conversion Systems that can duplicate the OEM fuel map settings will provide the best fuel mileage.

CNG Kit Installer: Tuning the CNG Conversion System properly is essential for a successful installation. Technicians must be trained and certified in CNG fuel systems installation and maintenance through accredited CNG Conversion Schools to prevent damage to your vehicle’s engine. If the fuel mixture is off, the conversion can cause severe damage to the valves or catalytic converter. When installed and calibrated correctly, the majority admit to experiencing more pep and receiving substantially better mileage.

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