Fuel prices – How high will they go?

With vehicle fuel prices surging across the country, pilots are also feeling the pain at the airport pump, with the price for a gallon of  avgas averaging more than $6 in every region, as reported by the website 100LL.com. According to statistics reported by AirNav.com, average prices for Jet-A remain about 50 cents lower, while mogas is a whopping $1.50 less than avgas.

It is no wonder that pilots are increasingly looking at using Jet-A and mogas instead of avgas, and airports are adding additional fuel storage systems for these lower-cost aviation fuels.

But how much higher could prices rise? This blogger would not attempt to predict future prices, however it is interesting to note how quickly we have arrived at the current situation.  As shown in the image here, gas prices have more than doubled since January 2009, as described in this article from Consumer Reports.  The US DOE’s Energy Information Administration (EIA) shows the trends in avgas prices and sales through the end of 2011. According to this data, the average cost of a gallon of avgas was a mere $1.86/gallon retail in January of 2009!

AirNav’s statistics on the average prices for avgas and Jet-A show a surprisingly large range of $4-$5 between the highest and lowest prices charged in a given region, a clear indication that some FBOs are enjoying better margins on sales than others.  With prices fluctuating rapidly however, timing is everything, and many FBOs are now waiting until supplies are nearly exhausted before ordering more, in the hopes of saving money on purchases. This has resulted in spot shortages of avgas at some FBOs, so it is a good idea for pilots to call ahead when making longer cross-country flights.

What’s the solution?  Clearly, in the short term, the expanded use of Jet-A and mogas will lower the cost of flying. As this blog recently reported, over 80% of the entire fleet of piston engine planes could already operate on mogas, saving $1.50 per gallon and making real progress on lowering lead emissions.  As this article documents, compared to full-service fueling, self-service fuel systems save pilots on average another 50 cents to a dollar more.

In the long term, one should consider the effect that the increased production of natural gas is having on its cost. In short, more supply leads to lower costs. Not only has increased exploration led to lower costs for commercial and personal applications of natural gas, but cheaper natural gas opens new opportunities for the use of CNG and LNG in vehicles (and perhaps, one day, in aircraft), as well as conversion to liquid fuels through GTL (Gas to Liquid) processes. A side benefit to the increased exploration for fossil fuels is the widespread use of business aircraft to move specialists and equipment between oil and gas fields the use of helicopters between well heads.

 

The GAfuels Blog is written by two private pilots concerned about the future availability of fuels for piston-engine aircraft: Dean Billing, Sisters, Ore., a pilot, homebuilder and expert on autogas and ethanol, and Kent Misegades, Cary, N.C., an aerospace engineer, aviation sales rep for U-Fuel, and president of EAA1114.

Comments

  1. Should the government get involved with subsidizing the cost of gas to save the general aviation industry?

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