I always used regular unleaded in my '95 850T. I don't accelerate hard from stops, but sometimes accelerate hard at highway speeds to much higher speeds. I never noticed any perfomance problems. I'm doing the same in my '98 S70T.

Use the fuel specified by the designers. Klaus is right, using low octane gas will reduce mileage and you won't save any money at all. Wait for the day when gasoline goes back up to over $3/gallon. We'll see 20+ posts per week asking if it is OK to use the low octane gasoline.

A minimum of 89 octane in the USA. If you like to depress the pedal, you really need 91+ octane.

The knock sensors are very good and will detect ping long before you can hear anything. The lower octane burns sooner than higher octane, especially when combined with 10:1 compression ratio, as in the NA engines. If knock is detected, the ECU will retard timing and add additional gasoline to each cylinder to keep the engine from knocking. This results in lower MPG and fouling up plugs and O2 sensors.

Considering the normal 10 cents/gallon difference in prices for each grade, 89 octane costs $1.80 more per tank than 87 octane, and 91+ costs $3.60 more per tankful. Not a bank account buster! Besides, the higher octane fuels usually contain more cleaning agents to keep your valves clean.

Klaus
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Proud owner of a 220S. If I had more room, I would have more Volvos.

I have a non turbo :)

I tried 87 once when gas was $4/gallon, and my car was angry and slow for about a week. Then again, I have a turbo model. With that and the A/C running, it took forever and a hard foot into the gas pedal to get the turbo to boost up - otherwise the 2.3 engine is very slow under 2 1/2K rpms, and low-quality gas only pronounced that lag.

I usually use 89, and performance is much better, but 93 makes a world of difference in how quickly the turbo starts to boost up (esp. around town) when I splurge for it.