It isn't because it makes your car faster.
Knocking. It’s the exact noise you want to hear when that cutie you were talking to on Tinder shows up at your door but it’s the very last thing that any car owner wants to hear coming from under the hood of their new sports car. As most of you may know, engine knock is just another way of saying pre-ignition, which is when the gasoline in your engine explodes before the intended ignition time. Not only does this sap the car of power but it can be extremely damaging to an engine.
Engineers design engines to work under certain parameters and deviating can cause damage. To understand what causes pre-ignition, we first have to look at the environmental factors that exist within an engine that makes the fuel/air mixture explode. Obviously the spark plug is the main catalyst, but the high pressure and heat helps. That’s why engines that place the fuel/air mixture under high pressure, such as those with forced induction or high compression ratios, are more prone to experiencing knock. That’s where octane comes into play. Contrary to popular belief, getting fuel with a higher octane rating does nothing to make your car faster. Instead, it actually makes it harder for the gasoline to explode, which in turn prevents knock.
The association between high octane and fast cars was made because most high performance machines have engines that are under a lot of stress. To prevent pre-ignition, a fuel with a higher octane rating is required. Back in the day, putting a low-octane fuel into a high performance engine with high octane needs was a recipe for engine knock, but most modern cars have computers to make them idiot proof. For example, if the owner of a McLaren 650S puts a low octane gas into their turbocharged machine, the computer will sense that and change ignition timing accordingly. This means that the engine is preserved but horsepower is lost until that tank of gas is used up and the proper fuel is put in. In this sense, yes, high-octane fuel will make a fast car faster.
Thing is, this is only because the motor is not holding itself back. On the other hand, putting high-octane fuel into a car that doesn’t require it will do nothing to increase the amount of horsepower being sent out of the crankshaft. Nowadays, it seems like more cars are getting their once unburdened engines replaced with motors that are smaller and produce more horsepower. This downsizing trend helps fuel economy, but given the knack for these engines to be turbocharged, they aren’t exactly saving consumers much money on fuel. The reason for this is that they require premium fuel to keep things under control with the added pressure from the turbochargers, and premium fuel is expensive.
In 1996, only 20% of cars required premium fuel but today, that number has risen to 50%. True to the market, the price of premium fuel has risen as well. In 1995, the price premium for high-octane gas was 18-19 cents per gallon more than standard fuel. The gap remained that way all the way until 2005, but subsequent years saw a leap in price. In 2011, the gap had risen to 25 cents over standard gasoline and now in 2016, it has risen to an average price difference of 47 cents. The reason behind this isn’t necessarily that gas stations want to reap the benefits of seeing more cars on the road that require better fuel, although marketing high octane fuel as better is partially to blame.
Instead, the issue is that production is still skewed towards churning out more low octane fuel, driving prices for high-octane gas even higher. As it turns out, many gas stations are actually losing money by paying as much as $1 extra per gallon for premium fuel while keeping their prices at the average 47 cent price hike. For the time being, things are likely to get worse as more forced induction engines, like Volkswagen’s insanely boosted 450 horsepower 2.0-liter four-cylinder, make their way onto roads worldwide. The shortage will cause a hike in price temporarily, but it won't last. Gas companies aren’t stupid, so once demand us high enough, high-octane fuel production will begin to catch up.