BioFuels Journal

American Coalition for Ethanol Reports More Oil Companies Are Selling Ethanol Blends at Fuel Pumps, Reducing Gas Prices

Sioux Falls, SD— The availability of ethanol is currently reducing the cost of gasoline by between 6 and 9 cents per gallon, according to data collected by the American Coalition for Ethanol (ACE).

"The growing availability of ethanol across the United States is reducing the cost of gasoline by up to nine cents a gallon," said Brian Jennings, Executive Vice President of ACE.

"While gas prices are still causing pain at the pump, ethanol is alleviating some of the pressure of hundred-dollar oil.

Without ethanol, gas prices would likely be even higher."

According to recent price reports by Axxis Petroleum and the Oil Price Information Service, ethanol for blending is selling for as much as 10 to 35 cents lower than gasoline, depending on the market. Factoring in the blender's tax credit, this means that the wholesale cost of E10 is between 6 and 9 cents less per gallon than gasoline.

"The price of gasoline isn't rising as quickly as the price of diesel, partly due to the fact that there's an alternative to gasoline - ethanol - that's adding more than 2 million gallons a day to our nation's fuel supply," noted Ron Lamberty, ACE's Vice President / Market Development.

According to today's AAA fuel price report, the national average price of diesel reached $4.029 a gallon, while the national average price of gasoline remains at $3.26 for regular and $3.587 for premium.

Oil companies are taking note of ethanol's blending economics.

Last week Marathon Oil Corp. announced that beginning in May, it will switch to an all-ethanol product slate at 16 of its Midwestern terminals, offering only E10 and no longer offering any unblended product.

ExxonMobil also announced a similar move, stating that beginning in May, the company is eliminating conventional gasoline at some of its terminals and moving to pre-blended E10 instead.

"We are pleased to see the oil companies recognizing the value that ethanol brings to consumers, and having both Marathon and ExxonMobil switch to ethanol at several of their terminals is a significant step in the right direction," Jennings added.

The U.S. now has the capacity to produce 7.9 billion gallons of ethanol on an annual basis.

More than half of the nation's gasoline contains some percentage of ethanol, most as E10, the 10 percent ethanol blend approved for use in all makes and models of vehicles. For more information, call Kristin Brekke at 605-334-3381.