I have a 1986 300E with 297k miles that has been running well for many years, originally as the family car and my commuter for last ten years. Lately, the gas mileage has dropped from always 20-21 mpg to under 18 mpg, During the same time, I've noticed a power loss that has gotten worse in the last week. The car has been maintained by me, but I have a few comments:
1. The engine needs valve seals (using oil but no smoke)
2. I replaced the oxygen sensor at 220k miles.
3. The fuel filter was replaced at 212k miles.
4. I recently pulled, cleaned and regapped the plugs.
5. The catalytic converter is original and I am concerned that it may be the problem (fouled with oil?).
6. The car starts easily and idles fine.
7. I notice the power loss when trying to accelerate to merge onto the highway. It seems like I cannot accelerate in a reasonable time.

Any thoughts?

Thanks for any help.

Brent Smith
Snellville, GA
1986 MB 300E
2003 BMW 530i
2003 Boxster S