100LL

[Jerry 5TJ]

2 hours ago, carusoam said:

Fortunately, with stocks... they stop at zero...

Unless you bought the shares on margin....

[carusoam]

Some differences...

Buying on margin.... means essentially borrowing money to buy lots of stock... when the stock goes to zero (or below an agreed upon value, the margin call...) .... you broker calls and ask if you want to put more money in to hold Your position... at this point you spent a lot of money...  and you are in the hole...

Short selling (a necessary market evil)... that is where your losses can be infinite... you bet on something to go down... and it gets on a runway train for the heavens... (ugh)

Buying a futures contract on some things... the worse case the price goes to zero... your contract is dead... your loss is what you paid for the contract...

For oil contracts... they can go negative... this contract is still live until 2:30pm Tuesday... (tomorrow...)

It is a giant case of macroeconomics... Supply vs. Demand...

Corona driven demand is way down...

World supply is at its highest...

horizontal drilling technology has been quite the enabler...

Opec and Russia can’t control their supply cartel very tightly...

Storage has pretty much run out of volume... making it technically difficult to allow demand to increase

North Sea crude is the European market for a slightly different oil quality...

It appears the North Sea price is lagging the WTI price by a few days....

Oklahoma adds to the technical challenges because it is in the middle of lots of land...

hard to get to the world markets without ships, pipelines, and trains... a distribution challenge that adds to the delay of things...

Hard to empty the storage vaults when the price of oil in them is high... people will be waiting to take their next delivery.... waiting to get a better price...

Sort of a chicken and egg situation similar to our 100LL issue at the local airport...

There have always been ways out of the darkness... it may take some time... know that it is always darkest before the dawn....

PP thoughts only, not a world economist...

Best regards,

-a-

[Shadrach]

On 3/28/2020 at 12:18 PM, toto said:

My understanding from FBO folks is that their prices lag way behind the auto pumps because they buy in bulk, and don't do enough 100LL volume to take quick advantage of price breaks.  They're always paranoid about buying too much when the market is moving rapidly, but also paranoid about losing out on a deal.  I suspect that av pump prices will come down in a month or so if oil prices stay crazy low.

Crude prices went negative today for the first time in history. Crude was at $20 on Friday when the Fuel truck filled the underground tank at my drome. Self serve is still 5.20...

[David_H]

27 minutes ago, Shadrach said:

Crude prices went negative today for the first time in history. Crude was at $20 on Friday when the Fuel truck filled the underground tank at my drome. Self serve is still 5.20...

Hopefully people will tank up at other pumps and let that fuel sit in the underground tanks.

This seems like an example of unreasonable predatory pricing and directly goes against the common argument about fuel currently sitting in the tanks being bought at a higher price per gallon.

[Shadrach]

7 hours ago, David_H said:

Hopefully people will tank up at other pumps and let that fuel sit in the underground tanks.

This seems like an example of unreasonable predatory pricing and directly goes against the common argument about fuel currently sitting in the tanks being bought at a higher price per gallon.

Maybe, but I try to imagine what the FBO is going through. It’s a ghost town. Demand will dictate fuel sales and there’s very little demand right now. I sympathize with them even if I disagree with the business practice.

[DonMuncy]

Actually, I like the idea of charging a price based on what you paid for the product. It is at least as fair, if not more so, than pricing on what you think you might have to pay to replace it. 

[Mooney217RN]

We all want lower 100LL pricing.  In fact, we should be paid to fill up with AvGas, right?

The reality is, as I was telling one of my close friends yesterday, the wholesale cost of 100LL hasn't dropped as dramatically as oil has.  In the Western U.S., it is still in the $2.00+ range.  Many FBO's are holding onto inventory that they purchased two months ago.  You cannot expect that the price of oil is going to translate to an instantaneous reduction the price of 100LL.  It is a boutique fuel as refined products go.

Last week, I had to fly into the SF Bay Area.  My home airport was selling 100LL for $3.95 per gallon.  I loaded up.  My destination airport in the Bay Area, SQL, was selling 100LL at $4.95 per gallon.  I took 5 gallons out of courtesy, as I was the only plane on the ramp and the fuel truck pulled up next to my plane.  I have never put 5 gallons onboard in my life, but I felt compelled to take something under the circumstances.

Bottom line, if you are expecting 100LL for $2.00 per gallon, manage your expectations - you aren't going to see that.  Anything with a $3 in front of the price is a fair deal.

[Hank]

21 hours ago, EricJ said:

We live in interesting times. 

Yes, we are experiencing the Ancient Chinese Curse:  may you live in interesting times!

Like Don, I would rather not . . . .

[Shadrach]

On 4/20/2020 at 10:04 AM, flyboy0681 said:

Well, at least we know where you stand.

Well now you're not alone...

[Shadrach]

12 minutes ago, Mooney217RN said:

We all want lower 100LL pricing.  In fact, we should be paid to fill up with AvGas, right?

The reality is, as I was telling one of my close friends yesterday, the wholesale cost of 100LL hasn't dropped as dramatically as oil has.  In the Western U.S., it is still in the $2.00+ range.  Many FBO's are holding onto inventory that they purchased two months ago.  You cannot expect that the price of oil is going to translate to an instantaneous reduction the price of 100LL.  It is a boutique fuel as refined products go.

Last week, I had to fly into the SF Bay Area.  My home airport was selling 100LL for $3.95 per gallon.  I loaded up.  My destination airport in the Bay Area, SQL, was selling 100LL at $4.95 per gallon.  I took 5 gallons out of courtesy, as I was the only plane on the ramp and the fuel truck pulled up next to my plane.  I have never put 5 gallons onboard in my life, but I felt compelled to take something under the circumstances.

Bottom line, if you are expecting 100LL for $2.00 per gallon, manage your expectations - you aren't going to see that.  Anything with a $3 in front of the price is a fair deal.

Fuel prices at my drome have not changed in months even though crude has been in a freefall.  As I said the tanker was there on Friday.  I am quite sure they've been through a few bulk orders since said freefall began. I don't blame for how they price their fuel but I don't necessarily think it's smart business. However, that's just my opinion which is not even worth a gallon of LL.  How they choose to operate is their business. I can purchase there or decide to go elsewhere. Whether my behavior influences their behavior is up to them.

[Mooney217RN]

100LL prices at my local airport have decreased between 80-90 cents per gallon.  The decrease is in line with what we've seen at our local gas stations.

[N201MKTurbo]

I had an acquaintance who traded in oil futures. He forgot to sell a contract once. They called him on the phone and asked when he was going to pick up his oil?

He was instantly in the oil business. He had to find a buyer and transportation. He lost a bit on that one....

[Paul_Havelka]

This may have already been said already but I'm being lazy and don't want to read all of this just yet.  Oil is traded in futures and although it's fluctuations do influence gasoline prices it is not a direct correlation.  Of course, if oil is sky high then gasoline will be high as well and vice versa but the price at the pump is tricky.  Gas stations are charging at the pump for what they will need to pay for the next load.  They have to watch their suppliers and anticipate how much their next load will cost them and and adjust their prices accordingly.  If they were behind the curve then they may have to raise prices more drastically than another  station does that is staying ahead of it. 

 

Now let's talk WTI, West Texas Intermediate, and Brent Crude.  The world standard is the Brent Crude and that is used to benchmark for offshore oil and gas work in the United States as well as most other countries and even land work in some of the other countries.  WTI is what drives the land work here in the US and that is typically the only ones that suffer when WTI tanks.  WTI is also less desirable than Brent which is why it is almost always less than Brent in the markets.

 

Now to 100LL.  If smart, they operate just like the gas stations.  That being said, a smaller airport that doesn't buy as much fuel will not be able to cash in on the lower prices as often as an airport with higher fuel consumption.  My home drome has been right at $3.83 for a few weeks.  That coupled with the reduced amount of GA traffic altogether due to the current pandemic may mean that you will never see some of the prices you think you should.  That along with the disparity due to region and who knows what it will actually go to.  I don't foresee seeing $3.00/gal at my drome at all.  It will go up before it ever reaches that point.

 

Paul

[PT20J]

In the Seattle area, 100LL prices range from $3.69 to $5.99 according to Foreflight. I just bought gas at my little airport for $5.74 because I know the FBO, know he doesn’t pump enough gas to make much money, and I appreciate it being available on the field when I need it.

Skip

[amillet]

29 minutes ago, PT20J said:

In the Seattle area, 100LL prices range from $3.69 to $5.99 according to Foreflight. I just bought gas at my little airport for $5.74 because I know the FBO, know he doesn’t pump enough gas to make much money, and I appreciate it being available on the field when I need it.

Skip

$2.80 at Chehalis (KCLS). Filled up last week on way to Troutdale for annual. Flew with a friend on Sunday and he filled up. Two other early J models there. Photo by @xcrmckenna

 

[carusoam]

NU is Charles!

-a-

[Brian E.]

20 minutes ago, amillet said:

$2.80 at Chehalis (KCLS). Filled up last week on way to Troutdale for annual. Flew with a friend on Sunday and he filled up. Two other early J models there.

 

 

I like the CB in the reg number--that's a true MS'er right there.

[Mooney217RN]

That's a good looking ramp.

[aviatoreb]

58 minutes ago, amillet said:

$2.80 at Chehalis (KCLS). Filled up last week on way to Troutdale for annual. Flew with a friend on Sunday and he filled up. Two other early J models there. Photo by @xcrmckenna

 

I see that is where they park the Brown Mooneys.

I would be looking for the Blue Mooney section of the ramp.

[Tim Jodice]

If overall sales are down and assuming that their cost of fuel has also gone down then not changing the price will increase their gross margins however they are likely still making less money after the bills are paid. Just a thought.

The airports that I frequently go to haven't changed there prices much. Shockingly Signature at MHT did go down about $.15

[cujet]

$4.75 at F45. Roughly the same as it's been the last few years. That price was not locally horrible 2 years ago, but now nearby airports are $2.58

[ragedracer1977]

$4.29 at home.  But 3.05 nearby.  I filled up for 3.19 at cottonwood (p52) yesterday

[carusoam]

Prices are really starting to move...  $3.50 in central Jersey.

Best regards,

-a-

[oldguyscanfly]

$3.83 self serve KICT Yingling

[xcrmckenna]

I see that is where they park the Brown Mooneys.
I would be looking for the Blue Mooney section of the ramp.

We have a blue Mooney in our formation group too. We will save a spot next to him when you show up...


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