Quoted from Shadow

It's the old supply and demand game, if you want it and there's a limited supply the one who is willing to pay the most will get it.

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Bankrate.com
Gas-saving devices mostly a scam
Friday August 24, 6:00 am ET

Julie Sturgeon



Over the years, the U.S. Environmental Protection Agency has tested a myriad of gas-saving devices that burst onto the consumer scene. These include devices that bleed air into the carburetor or bubble air through a container of water and antifreeze mixture, fuel-line gadgets that heat the gas before it enters the carburetor, magnets that clamp to the inside or outside of the fuel line to change the gasoline's molecular structure, and metallic fuel line additives with dissimilar metals that claim to ionize the fuel.

Experts say they all have one thing in common.

"They don't work," says John Millett, spokesperson for the EPA. "Believe me, if it were that easy, cars would be built that way, especially the magnets and whirligig devices. It's smart to be skeptical about claims like that."

The EPA to date has tested in the neighborhood of 100 gas-saving devices, the most recent at the request of the Federal Trade Commission, and only six "indicated a very small improvement in fuel economy without an increase in exhaust emissions."

Another four also made the itty-bitty improvement cut, but per federal regulations, the exhaust emission trade-offs mean consumers who slap these on their cars could face charges of illegal tampering.

Gopal Duleep, managing director of Energy and Environmental Analysis Inc., a technical consulting firm in Washington, D.C., estimates that 95 percent of the aftermarket products don't really change fuel economy.

Popular Mechanics magazine's experts tested seven fuel-saving products for its September 2005 issue and found no significant change in miles-per-gallon ratings. Two actually increased fuel consumption by 20 percent, according to the writer, and a third one melted before they could complete the test.

But none of this evidence stops an eager entrepreneur from pitching his product to people tired of watching the gas pump numbers spin.

"Over the last 15 years or so, I've seen the same products come and go under different names," says Roy Cox, manager of technical training and research for AAA Automotive and author of "Improving Fuel Economy: Money in Your Pocket."

Among the popular advertising claims the FTC is warning folks away from:

• "After installing your product on my car, I got an extra 4 miles per gallon." The trouble is, consumers aren't in a position to scientifically test their mileage for results. The testimonial may be heartfelt, but the driver didn't take into consideration traffic and road conditions, weather and his recent tuneup.
• "This gas-saving device is approved by the federal government." According to the FTC, no government agency endorses gas-saving products for cars. The closest they can come to truth in advertising is to say that the EPA has reached certain conclusions about possible gas savings by testing the product or evaluating the manufacturer's own test data.

The real scoop

Still, innovative breakthroughs happen every day in every field. Who says the gadget on the Internet isn't that phenomenon?

"These vendors will probably tell you there is some sort of conspiracy among the automotive manufacturers, but nothing could be further from the truth," Cox says. "They (manufacturers) do huge amounts of testing and put a lot of resources into research. It's not something they take lightly."

Consider the 1981 air-bleed device that the EPA discovered really did affect fuel economy positively. It shut the air-conditioner off during short periods of acceleration because the engine was already working hard. Today, new cars don't need the product, because Ford, General Motors and the gang incorporated that winning technology into their designs.

But the chances of lightning striking twice like that, particularly with piston engines, don't impress Duleep.

"It's a very small chance, largely because the piston engine has been around for more than 100 years. During this time, every particular angle has been explored, and the chance of somebody overlooking something fairly obvious is pretty small," he says.

For the auto-mechanically minded, it's common knowledge that inefficiencies in the engine and transmission account for much of a car's energy loss, and those are the areas where Duleep searches for improved fuel economy.

He likes GM's Active Fuel Management engine that uses eight cylinders when you need peak power on an interstate entrance ramp, for example, but cuts down to four cylinders during normal driving conditions. (DaimlerChrysler calls its version the Multiple Displacement System.)

"Those are the kinds of things that help you reduce the 20 percent to 37 percent gap between maximum efficiency and the typical efficiency in a car's energy use," Duleep says.

Cox, too, points to gas-guzzling problems in his booklet: If carbon buildup or running a few degrees too warm causes the engine to knock, the powertrain control module is programmed to retard the ignition timing to correct the problem. However, this retarded timing reduces the engine's power and, thus, burns more fuel. Conditions like combustion chambers that are too hot, worn piston rings, valves and gaskets or inadequate electrical power from the battery can also suck up to 8 miles per gallon off your bottom line.

Sorry, Charlie

But notice none of these areas experts cited has anything to do with fuel-tank additives. Most of these magic pills or sticks you drop into the gas tank claim to enhance performance by removing deposits.

"Only in very limited circumstances would that really help, because gasoline has detergents in it that take care of deposit buildup anyway," says Millett.

Those limited circumstances involve an older vehicle -- one with a carburetor rather than a fuel-injected system -- that is driven infrequently or in an atypical way.

"But for the vast majority of drivers, they don't offer a benefit that EPA has been able to say," he says.

Gizmos that fall into the "vortex generators" category in essence create mini tornadoes out of the inlet air between the air cleaner and intake manifold.

According to Popular Science, the idea is to mix fuel with air more thoroughly so that it burns more completely in the combustion chamber. Yet the turbulence reduces the amount of air sucked into the manifold, putting less power at your fingertips. That's how one of the brands Popular Science tested wound up costing a driver 20 percent more of his precious gasoline stash.

Cox has found another flaw with the bulk of air-injection products: They fail to combine air and fuel in the first place. "We don't inject the fuel until it gets right down next to the intake of the actual cylinders in the engine. So there are usually at least a couple of inches between the air intake and the fuel," he says.

Some car enthusiasts do purchase computer chips to recalibrate the engine and transmission, Duleep says. Such tinkering could cost up to $10,000, although you can find plenty of chips that supposedly upgrade your performance and mileage in the $200 to $300 range.

"You can see some modest fuel-economy improvements from those interventions, but it's usually done for performance or to add extra cachet to your car," he says.

Gas prices alone wouldn't justify that mechanic's bill.

Finally, the idea of applying magnets to the fuel line has captured many a car owner's imagination. The EPA's October 2005 reports, however, throw a wrench into that pipe dream. The product's advertised 27 percent fuel-economy improvement didn't materialize in the lab.

"The oil companies and automobile manufacturers are all saying the same thing, 'We wish it was that easy -- a pill in the tank or a magnet to paste into the fuel line -- because we would really like to get 20 percent better fuel economy ratings,'" says Cox. "We'd be all over it.'"

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Shell, Saudis to Spend $7 Billion on Texas Refinery (Update7)

By Christian Schmollinger and Eduard Gismatullin

Sept. 21 (Bloomberg) -- Royal Dutch Shell Plc and Saudi Arabia will spend $7 billion to more than double the size of their Texas oil refinery, the biggest U.S. expansion in fuel production in three decades.

The joint venture, Motiva Enterprises LLC, will boost capacity at the Port Arthur oil refinery by 325,000 barrels a day, making it the largest in the U.S., by 2010. The facility will process 600,000 barrels a day of crude oil, Motiva said today in a statement. That would be enough fuel to fill about 1.5 million cars in one day.

U.S. oil companies have been struggling to meet ever-rising gasoline demand because of local and environmental opposition to new refineries, which resulted in record pump prices above $3.20 a gallon this summer. The plant expansion will cost more than twice initial estimates, reflecting rising steel prices and escalating labor costs.

``We have had strong refining margins in recent years,'' said Ivor Pether, who helps oversee about $17 billion at Royal London Asset Management, including around 30 million Shell shares. ``It's probably very sensible for Shell to raise its capacity in America.''

Record Prices

Oil prices have surged to a record above $82 a barrel, even after the Organization of Petroleum Exporting Countries pledged last week to pump more crude. Saudi Arabian Oil Minister Ali al- Naimi and other group officials have frequently blamed higher prices on a shortage of refining capacity. Crude oil for November delivery traded at $81.48 a barrel in New York today.

The refinery expansion will cost $21,000 per barrel-a-day of capacity. That's ``consistent with recent industry estimates of refinery replacement costs,'' London-based Citigroup Inc. analyst James Neale wrote in a note.

Shell invests about $25 billion a year in projects, Malcolm Brinded, the company's head of exploration and production, said Sept. 4. The cost of the refinery expansion was estimated by Shell at more than $3 billion in April last year.

Both Shell and Saudi Arabia will supply heavy-grade crude oil to the refinery to be processed when the additional capacity is in place, Rob Routs, head of refining at Shell, said today on a conference call with reporters.

The price difference between a barrel of crude and a barrel of gasoline, a rough measure of refining profitability, rose to a record $37.477 a barrel on May 17 in the U.S.

Tax Breaks

President George W. Bush has pledged measures including tax breaks to spur construction and ease reliance on gasoline imports. Shell is betting that refining profit will surpass the escalation in costs, even though new capacity worldwide will drive margins down in the future, according to Routs.

This ``is one of the reasons why you need to have a very efficient refinery,'' he said.

Oil product supply has failed to keep pace with the growth in demand for transportation fuels. The International Monetary Fund forecasts global economic growth of 5.2 percent in 2007 after 5.5 percent expansion last year, extending the longest period that growth rates have held above 4 percent since the early 1970s.

The Port Arthur expansion is ``equivalent to building the first new refinery in more than 30 years,'' Motiva said in the statement. Marathon Oil Corp.'s 285,000 barrel-a-day Garyville, Louisiana, plant was the last new facility built in the U.S., starting up in 1976.

Refiners have been reluctant to commit to building new U.S. plants because of cost inflation and environmental objections, prompting Bush to offer disused military bases as potential sites. The Motiva investment will take place at an existing refinery, making permitting easier.

New Jobs

Motiva in April 2006 said it planned to begin the Port Arthur expansion in 2007 and to complete the project in 2010. Routs said today the total cost would be $7 billion and more than 4,500 construction jobs and about 300 new full-time jobs would be created.

``They've been talking about it for a while and the reason it's so expensive is that you're building all of the upgrading equipment to make higher-quality fuels from lower-quality crudes,'' said Alex Brooks, an analyst with UBS AG in London. ``The returns will be higher than with a new build. The number they're looking for is a 15 percent return.''

Expanding Existing Plants

The existing Port Arthur refinery is about 90 miles (145 kilometers) east of Houston and can process 275,000 barrels a day. The expansion will vault the Port Arthur refinery past Exxon Mobil Corp.'s Baytown, Texas, plant, currently the largest in the U.S. with capacity of 562,500 barrels of oil a day.

The engineering contract for the enlargement project was awarded to a joint venture of Bechtel Corp. and Jacobs Engineering Group Inc.

Marathon Oil will add 180,000 barrels a day of capacity to the Garyville refinery for $3.2 billion, it said in November. The project is scheduled to be completed in the fourth quarter of 2009.

Chevron Corp. plans to expand a gasoline production unit at its Pascagoula, Mississippi, facility that will boost output by 10 percent. The unit currently refines 330,000 barrels a day.

To contact the reporter on this story: Christian Schmollinger in Singapore at christian.s@bloomberg.net ; Sophie Tan in Singapore at sophietan@bloomberg.net .

Last Updated: September 21, 2007 11:42 EDT

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Oil prices slip below $79 a barrel
By GEORGE JAHN, Associated Press Writer 8 minutes ago
VIENNA, Austria - Oil prices dropped Tuesday after Royal Dutch Shell said it will boost production from an oil terminal in Nigeria, Africa's largest oil producer.

The dollar's recovery also weighed on prices, along with signs that the worst of the Gulf of Mexico storm season was over.
Light, sweet crude for November delivery lost 25 cents to $78.77 a barrel by noon in Europe on the New York Mercantile Exchange in electronic trading. The contract fell $2.20 to settle at $79.02 a barrel Monday in New York.
November Brent crude fell 27 cents to $76.31 a barrel on the ICE futures exchange in London.
Heating oil and gasoline futures slipped by nearly a penny to $2.1516 a gallon (3.8 liters) and $1.9905 a gallon (3.8 liters). Natural gas futures added 8.4 cents to $6.930 per 1,000 cubic feet.
News that Royal Dutch Shell PLC would boost production at a Nigerian oil platform shuttered by violence last year helped to send prices lower. Monday, the oil company said it had lifted a monthlong force majeure from its Forcados oil terminal. Force majeure is a legal condition which protects a company from not meeting contractual delivery obligations.
The Forcados terminal, which can pump 380,000 barrels of oil a day at full capacity, was shut down by militant attacks in February 2006, but has been operating at 1 percent to 3 percent of capacity since this summer.
In recent months, violence has abated in Nigeria, Africa's biggest oil producer and one of the top overseas suppliers to the United States.
While Vienna's PVM Oil Associates noted that "production at the Forcados field is still very low," signs that the worst was over at the oil field supported prices.
Oil prices have been volatile in recent days as investors have debated whether demand will weaken in the fourth quarter.
Some analysts point to ebbing demand for gasoline and forecasts for high temperatures through December as signs the oil, gasoline and heating oil markets are adequately supplied. Others say low heating oil inventories and refinery activity shows supplies are tight.
As a result, some analysts believe oil will fall to $65 a barrel or lower, following a typical seasonal pattern, while others expect futures to break that pattern and push toward $90 a barrel.
"This is the shoulder season between the peak summer and winter season for oil ... so it's quite typical to see a softening in prices," said Victor Shum, a Singapore-based energy analyst with Purvin & Gertz. "But I think oil market fundamentals remain quite firm in the near term ... It won't be long before traders worry about the low heating oil inventory."
A strengthening dollar has also led to lower oil prices, Shum said.
The greenback fell to a record low against the euro after the U.S. Federal Reserve cut interest rates in September, and that helped push crude oil futures to a record high of $83.90 a barrel later in the month. A weak dollar makes oil and other dollar-denominated commodities inexpensive when calculated in other currencies.
But the dollar has rebounded some after a report issued Friday showed U.S. jobs growth in September was the highest since May, easing fears that the world's top energy consumer was set to tip into a recession.
Analysts say oil prices are also easing as the market believes tropical weather systems no longer pose a serious threat to critical gas and oil infrastructure in the Gulf of Mexico.
Traders are now waiting for the U.S. Energy Department's weekly report due Thursday, delayed a day because of a federal government holiday Oct. 8.
U.S. crude oil inventories are expected to have gained 1 million barrels in the week ended Oct. 5, according to a Dow Jones Newswires survey of analysts. Gasoline inventories are expected to have fallen 300,000 barrels while distillates, which include heating oil and diesel fuel, are expected to have dropped 600,000 barrels.

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Report forecasts higher heating bills this winter
BY JOHN WILEN The Associated Press

   NEW YORK — Almost all Americans will pay a lot more to heat their homes this winter, even though temperatures are expected to be warmer than average.
   That’s the sobering message from an Energy Department report Tuesday that estimates heating oil costs are likely to jump 22 percent and natural gas bills, on average, will rise 10 percent between October and March.
   And while the National Oceanic and Atmospheric Administration forecast a milder than average winter in most parts of the country, the agency also predicted Tuesday that temperatures will be 1.3 percent colder than last year.
   In Massachusetts, where about 40 percent of homeowners rely on oil for heat, consumers are bracing for price spikes, said Michael Ferrante, president of the Massachusetts Oilheat Council, a trade group. “They are buttoning up their houses even more, they are turning down their thermostats, they are wearing sweaters,” he said.
   Surging crude oil prices are the primary, but not the only, culprit for the jump in fuel oil costs. This spring and summer, American refineries experienced an unusual number of unexpected maintenance outages. The net result was that fewer refineries were producing gasoline, heating oil and other petroleum products.
   The outages sent gasoline prices to a record $3.227 a gallon in late May as refiners scrambled to produce enough gasoline to meet peak summer driving demand.
   “Because they used every ounce of the refinery to produce gasoline, it came at the expense of distillate fuels” like home heating oil, said Phil Flynn, an analyst at Alaron Trading Corp. in Chicago.
   Despite the government forecast, natural gas futures prices have actually been mostly falling in recent weeks. Inventories remained high as new sources of natural gas were tapped this year and a cooler summer depressed demand.
   “We could have all-time record storage by the beginning of February,” said Tim Evans, an analyst at Citigroup Inc. in New York.
   But all of that could turn around if oil prices stay high and electricity plant operators switch to natural gas for units that can burn either fuel, said Ron Denhardt, CEO of Strategic Energy & Economic Research Inc., in Winchester, Mass.
   On the other hand, supplies coming on line this year, including Anadarko Petroleum Corp.’s Independence Hub platform in the Gulf of Mexico and a portion of the huge Rockies Express natural gas pipeline project, are expected to boost natural gas supplies by 2 billion to 2.5 billion cubic feet.
   “That’s a lot of supply coming on,” Denhardt said.
   The Energy Department estimated a gallon of heating oil will rise to $2.88 this winter as crude oil prices stay high. Crude futures traded on the New York Mercantile Exchange have surged by more than a third from a year ago and settled Tuesday at $80.26 per barrel, up 1.2 percent for the day.
   In Massachusetts, the Division of Energy Resources said dealers were charging an average $2.72 a gallon for fuel oil on Tuesday — a record high, and up 5 cents from the most recent survey on Sept. 18. The fi gure is 11 cents higher than the peak that followed a series of price spikes after Hurricane Katrina in 2005.
   Heating oil is used by 7 percent of American households, mostly in the Northeast, while natural gas heat is used by 58 percent of households. Another 30 percent are heated by electricity, which the Energy Department estimated will rise 4 percent in cost this winter.
   For the 5 percent of American homes that use propane, winter heating costs are expected to increase 16 percent.
   While some homeowners are choosing to convert to natural gas furnaces, oil dealers argue that such conversions don’t pay. An average conversion costs $5,575, the Oilheat Council says.
   “I think consumers understand if they do the research, heating oil has been cheaper than natural gas in the past,” said Ken Williams, owner of Scott-Williams Oil, in Quincy, Mass.
   The wild card in the heating cost estimates is the weather. If the U.S. experiences a warmer than expected winter, prices of some fuels could fall through the winter.
   But if the winter is particularly cold, prices could jump more than expected. “You could have [supply] tightness if you’re going to have a colder-than-normal winter,” Evans said.
   Penny Taylor, who spent about $350 a month last winter to heat her Sarasota, Fla., home with electric heat, blanched when she heard about Tuesday’s price forecast from the Energy Department.
   “I think we’re going to have to get a lot of blankets, because there’s no way we’ll be able to afford to run the heat,” she said.