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The only way you are going to make more power on a carbureted engine by switching octane is by reducing pinging/knocking at whatever the ignition timing is set at at the time. When you up the octane from say 91 to 100+ on a carb engine, you can usualy throw an additional 4-6 degrees spark advance at it without pinging, which is where you feel the extra power comming from. Too much octane can cause you to lose performance too, especially in a low compression/non- turbo engine. If the octane is too high for the engines compression level, the gas might not burn completely durin the combustion cycle, where as a lower octane gas would, giving more power durin combustion than the higher octane would. Computerized engine management systems just reduce ignition timing when knock sensors detect pinging/knocking, which kills reduces power, and also richens the air/fuel mixture which causes you to also lose economy. O2 sensors don't "sniff out the octane level" since they are measuring the Oxygen in the exhaust gasses after they gas has been burned, which tells the computer what adjustments need to be made to the fuel mixture. Regular unleaded won't "burn out" the O2 sensor, but oxygenated fuel tricks the O2 sensor into thinking the engine is lean, which in turn tells the computer to richen the mixture, again hurting performance and gas mileage. I notice a drop in mileage with all of my computerized vehicles every winter when the gas stations switch over to the oxygenated gas, then notice it pick back up again every spring once they go back to the normal gas. The only gas that might harm the sensor would be leaded fuel, like low-lead 100 octane AV gas, which actually does more harm to the cataletic (sp?) convertor, than to the O2 sensor.
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