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100LL


Richie the C

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I have a 550 gallon tank at my hangar which forces me to speculate on avgas pricing.  Our area has only one avgas supplier unless buying 8000 gallons, or more.  His pricing is kept somewhat in line by the prices charged by local FBOs.

Over the years, I've developed a (constantly adjusted) algorithm:  when my local supplier is delivering fuel for $4, or less, I fill my tank.  If local FBO prices drop below $4, I use the FBOs as much as practical, when local prices rise above $4, I use my fuel as much as possible.  Occasionally, I go through periods where my tank is either empty, or sitting full, but generally, I average "better than the FBO" prices and the fuel in my tank doesn't sit long.

Owning your own tank has high overhead:  initial purchase of the tank, evaporation/shrinkage, changing filters, pump, hose, fuel counter, etc.  The slight price advantage over the FBOs dosen't begin to cover the overhead, but the convenience of fueling at my house (no airport fuel available) makes it worthwhile to me.

22 years ago, when I bought my tank, the first load of Avgas was $1.60/gallon and a case of Aeroshell W100 was $18 + tax.

Does the price of aviation oil ever go down?

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As an owner of multiple FBO's, I decided I would weigh in on this and explain some of the factual reasons why 100LL hasn't dropped as precipitously as oil.

First & foremost, the decline in oil has been very fast, over a 2 week timeframe.  Oil is a feedstock for fuel.  The fuel we are using now was refined weeks ago, before oil declined precipitously.  Compounding matters, 100LL is a boutique fuel.  Very little of it is refined, very little consumed in the big scheme of things.  There is also a transportation issue with 100LL - it is transported exclusively by truck to the airport.  In some cases, it is moved from refineries to distribution points via rail car, but it is moved from those rail cars to the airport via truck.  This is in contrast to JetA, Diesel & gasoline, all of which are transported via pipeline to distribution points around the nation.  The cost to move a load of 100LL is about 20 cents per gallon.  There are also very steep state and federal excise taxes on 100LL AND flow fees that you pay based on the airport where you purchase it.  In California, the excise taxes alone are around 40 cents per gallon for state & federal combined.  That doesn't include any airport imposed flow fee.

Finally, the fuel in the tanks of most FBO's was purchased well before prices started to drop.

So there you have it, no joy for those of us who use 100LL.  For what it's worth, we price our 100LL to be the lowest in the state by design, to encourage people to fly in.  MooneySpace discourages promotion, so I cannot tell you which location we do this at, but you can look on AirNav and might figure it out.  Next week when we take our next delivery will be in the $3.xx range, and it will be lower than any airport within our state.

Edited by Mooney217RN
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36 minutes ago, Mooney217RN said:

....

Finally, the fuel in the tanks of most FBO's was purchased well before prices started to drop.

So there you have it, no joy for those of us who use 100LL....

Great explanation!

The big drop off in flying means the higher priced avgas will be around longer since we're not using it.  The FBOs are loathe to sell fuel cheaper, until they've bought the cheaper fuel. 

However, some FBOs seem happy to sell cheap fuel for more when the spot price rises.

I bought 500 gallons a week ago at $3.46/gallon.  I suspect 8000 gallons could be had for well less than $3/gallon right now.

Now go to airnav.com and check the prices around KATL today.  ($7.98 ‐ $3.88)

We need the FBOs to stay in business, but there are a few big FBOs I love to hate.

 

Edited by Mooneymite
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Great additional details, 7RN.

Often, MSers include their location in with their avatar info...

Some put additional details like a website in their ‘signature line’

If people are looking for you, they can find you...


Many appreciate vendors not constantly selling here... but some vendors do add more to the conversation...

There is an opportunity for those people to be a site sponsor... we have a few around here...

It really helps if you have Mooney specific services... :)

Probably hard to get an MSer discount from the lowest cost fuel provider..?
 

A wave of MSers flew through TX one year to purchase a fuel special from DMax... that was amazing!

Best regards and thanks again..,

-a-

 

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51 minutes ago, Mooney217RN said:

MooneySpace discourages promotion, so I cannot tell you which location we do this at, but you can look on AirNav and might figure it out. 

I can’t figure out what state you’re in from your profile 

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15 minutes ago, Mooneymite said:

Great explanation!

The big drop off in flying means the higher priced avgas will be around longer since we're not using it.  The FBOs are loathe to sell fuel cheaper, until they've bought the cheaper fuel. 

However, some FBOs seem happy to sell cheap fuel for more when the spot price rises.

I bought 500 gallons a week ago at $3.46/gallon.  I suspect 8000 gallons could be had for well less than $3/gallon right now.

Now go to airnav.com and check the prices around KATL today.  ($7.98 ‐ $3.88)

We need the FBOs to stay in business, but there are a few big FBOs I love to hate.

 

No FBO is going to take a loss on fuel sales.  You're in a different market than we are, where the wholesale price of the fuel is well above $3.50 still.

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1 hour ago, Mooney217RN said:

No FBO is going to take a loss on fuel sales. 

I've often wondered about this.  If an FBO bought 8000 gallons just before the big price drop, what are the options?

Will the FBO just sit on that high priced fuel until it finally sells and watch market share divert to other FBOs, or will it take a short term loss to unload that high priced fuel to retain customers? 

Neither seems like a good option profit-wise.

As my fuel supplier explained to me, "Gus, in this business, I lose money when fuel prices go up and I lose even more when they go down".

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In central NJ... there is one airport who makes it there policy to sell lots of fuel... at the lowest price self serve possible...

The expectation is to bring people in to the airport for all the other reasons... including ultralights...
 

47N - Central Jersey, formerly known as Kupper Airport...

Showing $4.15 according to today’s flightaware... $3.95 is the lowest in the neighborhood... down the shore...

 

https://www.globalair.com/airport/fuelmap.aspx?aptcode=47N

Best regards,

-a-

 

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$3.88 here on the left coast...... SBP, L52, SMX.  :)

I just realized our 100LL price is just a few cents more than our 91 octane auto fuel price.................not typical, most unusual. 

Here in the San Luis Obispo, Arroyo Grande area, we have probably the highest auto gas prices in the country. :angry:

The price of living in paradise.........:lol:

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18 minutes ago, carusoam said:

Showing $4.15 according to today’s flightaware

And that’s grossly overpriced for self serve Anthony! And I’m not too keen on fueling from that corroded tank! I filled up at GED three days ago for 4.21 $/gal.

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Hey, I like to save money just like the next guy. But, since the airlines and military stopped using avgas, and more and more of GA burns kerosene, I’m just kind of glad that they still make the stuff. And, I’m grateful that major FBOs are still willing to deal with little airplanes. I always tip the line crew, fill the crew car with gas, top off the airplane and never complain about the pump price. 

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51 minutes ago, PT20J said:

Hey, I like to save money just like the next guy. But, since the airlines and military stopped using avgas, and more and more of GA burns kerosene, I’m just kind of glad that they still make the stuff. And, I’m grateful that major FBOs are still willing to deal with little airplanes. I always tip the line crew, fill the crew car with gas, top off the airplane and never complain about the pump price. 

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Great point.   Here's the way I look at it.  Fuel costs about $40-$60/h for a Mooney depending on how cheaply you buy your fuel and how fast you want/can fly.   According to my expense spreadsheet, that is less than 25% of the costs of operation per hour, all expenses considered and pro-rated into the cost of ownership.  I sure hope they don't just decide to put us all out to pasture and stop making the stuff.

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Over 30 years ago when I purchased my first airplane, a friend and airplane owner told me that the best part of owning an airplane is that the flying is free. When I questioned that, he pointed out that given all the costs involved with owning, maintaining and upgrading an airplane, the gas and oil for an hour of flying was minuscule -- essentially free.

Richard Bach wrote years ago that he wanted to buy a single engine airplane but couldn't justify the cost until he remembered that he really wanted a twin that would burn much more fuel. So he reasoned that by not buying the twin, the fuel savings would pay for the single. Extending that logic, he reasoned that if he ran out of that money, he would not buy a Learjet and that would finance his flying forever.

The point is that these things are not cost effective unless you really torture the analysis or can write off expenses to a business. They provide utility and we own them because we want them and can somehow manage to afford them. If the fuel cost makes or breaks the deal, we should perhaps rethink the entire proposition.

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While I shop for lower fuel prices to reduce my overall cost... including reserves it effectively costs $16,000 to fly my first 100 hours including $5.00 fuel.

at $4.00 a gallon the same formula will yield $14,400....

yes, typically I fly slow about 125k lean if peak...

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I once heard an old man reply to a young whipper-snapper of a pilot who was inquiring about the price of avgas at our local FBO: “Young man that there is not your typical run-of-the-mill fuel.  It’s like Kickapoo Joy Juice for your Mooney!”  (Of course, we’re based at Kickapoo, Wichita Falls, TX)

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10 hours ago, PT20J said:

Over 30 years ago when I purchased my first airplane, a friend and airplane owner told me that the best part of owning an airplane is that the flying is free. When I questioned that, he pointed out that given all the costs involved with owning, maintaining and upgrading an airplane, the gas and oil for an hour of flying was minuscule -- essentially free.

Richard Bach wrote years ago that he wanted to buy a single engine airplane but couldn't justify the cost until he remembered that he really wanted a twin that would burn much more fuel. So he reasoned that by not buying the twin, the fuel savings would pay for the single. Extending that logic, he reasoned that if he ran out of that money, he would not buy a Learjet and that would finance his flying forever.

The point is that these things are not cost effective unless you really torture the analysis or can write off expenses to a business. They provide utility and we own them because we want them and can somehow manage to afford them. If the fuel cost makes or breaks the deal, we should perhaps rethink the entire proposition.

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I like the way you think.

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I pulled up to buy some fuel in New Smyrna Beach yesterday ($2.87) and I ask the controller if the tanks at my 2 o'clock are the city self serve pumps (as I'm taxiing).  He had a good sense of humor and says "no fuel here, what you see there is water and gatorade...everyone seems to stop for our cheap fuel and then leaves right after!".

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I wouldn't say idled, but probably not flying as much as they used to.  To me these prices just make sense with the price of oil.  I'm not sure what New Smyrna was before but somewhere like 28J (Palatka FL) is consistently in the 3.50-3.75 range and they are now $2.78.  As some others have pointed out I don't think we've seen the bottom pricing of some of these airports since the oil that was refined to make the 100LL they bought certainly wasn't at $20/barrel where it is now.

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The lag in prices dropping certainly does not exist when the price of crude oil increases. That seems to be almost criminal and fraudulent but then again I keep buying stock in the refiners.

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WTI West TX Intermediate...

Went below $20 /barrel this afternoon... 19.35

This is a price lower than any of three major countries can produce at... long term...

At the same time Storage facilities seem to be full up...

This is where strategic oil supplies get filled up... and tankers get used for storage...

Russia and Saudi are still not slowing production yet...

PP thoughts only, not an oil market analyst...

Best regards,

-a-

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14 minutes ago, carusoam said:

WTI West TX Intermediate...

Went below $20 /barrel this afternoon... 19.35

This is a price lower than any of three major countries can produce at... long term...

At the same time Storage facilities seem to be full up...

This is where strategic oil supplies get filled up... and tankers get used for storage...

Russia and Saudi are still not slowing production yet...

PP thoughts only, not an oil market analyst...

Best regards,

-a-

Seemingly a nice little strategy between Putin and the Saudis, drive the price down when there is very little demand.  A ton of producers go bust and then price goes higher than it was before when demand picks up.

 

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