Originally Posted by Fluxaholic
It doesn't matter what the price of 87 octane is. The differential between 87 and 91 octane is always about $0.20 regardless of how high gas prices get. Whether or not the added fuel efficiency is worth the additional $0.20 has nothing to do with the total price of the gas.
Sorry, but you're mistaken-
Example- These aren't the actual numbers as I don't have that info in front of me, but let's say 87 octane is $2.75/gal and 91 is $2.95
If I get 16.90 mpg with 87 that's 16.27c/mi
If I get 17.75 mpg with 91 that's 16.62c/mi
=> Cheaper to use 87 octane even though the 91 gives me 5% better mileage per gal.
Second example- Let's say 87 octane is $4.10/gal and 91 is $4.30/gal
If I get 16.90 mpg with 87 that's 24.26c/mi
If I get 17.75 mpg with 91 that's 24.23c/mi
=> Cheaper to use 91 octane
Contrary to intuition, if the 91 octane price was a fixed percentage more than 87, then it would either always be cheaper to use 91 or always cheaper to use 87.
Example - if 91 octane cost 10% more than 87, then you would have to get 10% better mileage with 91 octane in order to break even. (if you only got 5% better mileage, it would cost you 4.8% more to drive w/ 91 octane)
The fact that, as you pointed out, the differential price rarely changes much at all, despite 87 octane going from $1.50 to $3 per gal is precisely the reason why it makes a difference as to what the price of 87 octane is. (since you can state the price of 91 as [price of 87 + 0.20] in your example) It could also be described by saying that when 91 octane is above a certain price -assuming that the price differential is the same.