Gap Between Ethanol Prices and Gas Prices Continues to Widen

Corn is Awesome

The price gap between ethanol prices and gasoline continues to widen, according Bloomberg, who says the “discount”, or the cost incentive to choose ethanol over gas has increased from “0.26 cents to 36.55 cents a gallon, the steepest since April 26, as a June 5 Energy Information Administration report showed production climbed to the highest level in more than 11 months.”

“It just seems like a lot of gallons have showed up,” said Jim Damask, a broker at StarFuels Inc. in Jupiter, Florida who cites that supply for (ethanol) has gone up, but demand remains relatively low. “We’re seeing a lot of physical for sale and not a lot of buyers.”

Why are Ethanol Prices So Low!?

 

That lack of demand probably has a lot to do with deliberate lies spread by Big Oil lobbyists, bogus studies by GOP puppet-groups claiming ethanol production leads to higher food prices, old-school backwards mechanics who incorrectly claim that ethanol detracts from engine performance, and the false impression that ethanol production benefits from more government subsidies than oil or gasoline.

That’s just my thinking out loud, of course – but there is no question that demand for octane-boosting ethanol as a fuel is lower than it has been. Bloomberg states that “ethanol-blended gasoline made up 89 percent of the total U.S. gasoline pool last week, the least since Feb.”

February? Isn’t that about the same time Big Oil got their a**es handed to them in this landmark court case? Why – yes, it is! No wonder they’ve kicked their marketing machine into overdrive!

Here’s hoping that the American citizens wise up. Or, at least, that they start to take advantage of low ethanol prices and just happen to help clean up the air, produce American jobs, and advance the cause of renewable, domestic fuels.

You can check out the original Bloomberg piece at the link, below. Also, in deference to Adventure Time’s copyrights, that’s “Jack the Corn Dog”, not in any way “Jake the Awesome Adventure Time Dog”.

Source: Bloomberg, Image: FunnyJunk.

 

Jo Borrás

I've been in the auto industry 1997, and write for a number of blogs in the IM network. You can also find me on Twitter, at my Volvo fansite, or chasing my kids around Oak Park, IL.