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Monday, June 11, 2007

Gasoline Prices In Brazil Much Higher Than In USA

AAEA President Norris McDonald recently visited Sao Paulo, Brazil and noticed that although gasoline prices are higher than in the USA, ethanol prices are comparable. A litre of gasoline was about 2.50 reais (real), which is about $5 per gallon in the U.S. Ethanol was about 1.50 real or $3 per gallon in the USA. Ethanol (the alcohol produced by fermenting sugar) sells at between a third to half of the price of gas. Gas sold at the pumps in Brazil is 25 percent ethanol whereas gas sold in the US, China, Australia and Canada is 10-15 percent ethanol. Presently the use of ethanol as fuel by Brazilian cars is about 40% of the fuel that would be needed to run the fleet on gasoline alone. In 2005, Brazil consumed 2,000,000 barrels of oil per day, versus 280,000 barrels of ethanol. (USDOE)

Regular car engines will run fine on a 10 percent blend of alcohol and gasoline. Flex car engines run on either ethanol, gasoline, or any combination of the two. Ethanol engines use 25 percent more ethanol per mile than gasoline. The US has about 4 million flex cars, but there are 14 states without one ethanol pump according to the National Ethanol Vehicle Coalition. Brazilian drivers can fill up with ethanol at 29,000 filling stations. In the USA, there are only 1,200 gas stations that sell the E85 fuel — a blend of 85% ethanol and 15% gasoline. (American Lung Assoc)(Christian Science Monitor)

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