Gasoline prices rose to their highest level in the past two years yesterday. According to AAA, the average price of gasoline climbed one penny Dec. 29 to $3.071 per gallon. This is the highest level since October 15, 2008, when the average price of gasoline reached $3.084.

If you've been reading this blog, you're aware that the cost of crude oil is the largest factor in the price of gasoline. Between November 17 and December 28, crude oil prices increased 26 cents per gallon to $2.18 per gallon ($91.49 per barrel), which was the highest level in October 3, 2008, when the per-barrel price reached $93.88.

Demand for gasoline and diesel fuel also have climbed recently. Last month, according to API's Monthly Statistical Report, gasoline demand rose 3.2 percent over November 2009. Demand for Ul... more »

Changes are planned for heating oil in the Northeast. In the region of the country where the preponderance of heating oil customers are located, several states are reducing the amount of sulfur allowed in the fuel.

• New Jersey announced recently that it will lower sulfur from 2,000-3,000 parts per million (ppm) to a maximum of 500 ppm on July 1,2014, and then down to 15 ppm on July 1, 2016.
• New York has passed legislation reducing the sulfur content from a maximum of 10,000 ppm to 15 ppm in 2012.
• Maine's regulation, signed into law in April, will reduce sulfur to a maximum of 50 ppm by January 1, 2016 and to 15 ppm by January 1, 2018.
• Connecticut has chosen to follow the lead of three other states. It will reduce heating oil sulfur to 50 ppm in July 2011 and down again to 15 ppm in 2014 o... more »

Did you know that today's diesel-powered light-duty vehicles must meet the same stringent emission requirements as gasoline-powered models?API helped those diesel vehicles meet the same air quality standards as gasoline vehicles in two ways. First, by producing Ultra-Low Sulfur Diesel (ULSD) fuel, which burns more cleanly than earlier forms of diesel fuel. And second, by developing a certification program for Diesel Exhaust Fluid (DEF). DEF is a liquid that is injected into the exhaust system of diesel vehicles from a container located under the hood in most cars. The DEF hydrolyzes into ammonia when injected into the exhaust, and the ammonia reacts with the nitrogen oxide (NOX, which is a precursor to ground-level ozone formation) in the catalyst and converts it to pure nitrogen and water... more »

API reported today that April gasoline production climbed to 9.1 million barrels per day, which is the highest level ever for April and second highest level for any month on record, according to the Monthly Statistical Report.

Gasoline demand also rose last month, and U.S. refinery utilization climbed above 85 percent for the first time this year. API Chief Economist John Felmy said the data indicates that refiners are cognizant of consumers' need for gasoline and are producing fuel to keep America moving.

In one particularly bright spot, the April statistics showed that U.S. distillate demand surged 6.7 percent over the April 2009 level. The demand for distillates, including diesel fuel, historically has had a strong correlation with economic activity.

In April, demand for Ultra-Low Sulfu... more »

In testimony delivered in Houston yesterday, API's Policy Advisor Ten Steichen told the Environmental Protection Agency (EPA) that its proposed new ozone pollution standard would exact significant costs on consumers, jobs and the economy without providing commensurate benefits.

Ted also said that there is no scientific justification for imposing the more stringent standards.

"There is actually far more debate on the science than EPA has represented," Ted said, noting that the studies EPA used for its proposal do not support lowering the ozone standard. "At the time of the 2008 rulemaking, it was clear that there were many issues with these studies, and those issues remain."

Dr. Robyn Prueitt, who reviewed the studies, agreed. Dr. Prueitt said the human-exposure tests conducted in 2002 and... more »