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It sounds like you only get the smell after the vehicle has sat for a period and you restart it? If you don't have any fuel smell while it's sitting then most likely you don't have an actual external fuel leak and if the engine light isn't coming on then you shouldn't have to worry about an evaporative emissions leak.
Your symptoms point to a possible fuel injector leak. When you shut the engine off there is a check valve in the pump that prevents drainback and holds pressure in the system. Fuel injectors can develop leaks, sometimes small and sometimes large, which will drip fuel when the engine is off. When you go to restart it then this will cause a fuel smell and possibly light colored smoke from the exhaust.
If you only have the smell when starting the engine after it has sat for a little while then I would recommend checking the injectors for leakage.
My wife thought it was a gas smell, I felt it was an exhaust smell. I wasn't sure if there were some issues with exhaust tubes under the hood of the Volvo V50 that may leak on initial startup. It goes completely away within 30 seconds but you get a good wiff coming through the dashboard vent ports. Volvo serviced the turbo for a small leak on the seals for oil passing by. I'm too unfamiliar with Volvos to even consider having done that type of work. If there were some residual leaks like you describe, why would the smell come inside to the passenger compartment? Shouldn't it be a closed area so air from the engine compartment never enters the passenger area? This is what confuses me. I like your reply and will note it to Volvo when bringing it in for its oil change this week. There's no way of knowing if it is continously leaking air from the engine compartment or not. Especially if it is what you say it is. The fuel would just burn away that quickly I guess and not be noticable. Thank You for the reply.
The smell can come in through the heater box's outside air intake. Air is drawn from outside the vehicle any time you are using any mix of defrost or unless it is manually switch to recirculation mode. The air intake is in the cowl area above the engine so it's possible that you could be smelling something from the engine compartment.
It's possible that you could be smelling exhaust. Small exhaust leaks can be there when the engine is cold and then seal up as the components heat and swell. If you had an exhaust leak then you should be able to hear it tick or hear what sounds pretty apparently like an exhaust leak if you start it up with the hood open and listen there. If you start it with the hood open you may also be able to smell that it's coming from that area. If it was an exhaust leak and is bad enough to smell inside then I would expect you to be able to hear it at least on a cold start.
Thanks. I think you're right. There is a very small interval of clicking sounds which dissappear within 10 seconds on cold starting. I thought it sounded like an old pvc valve clicking but must be related to the smell.
I did remove the vacuum lines and replaced them on reassembly after the plug replacent. Something is surely leaking there to make that sound. I'll open the hood today on a cold start and try to isolate before it goes in.
That may very well be an exhaust leak then. A small exhaust leak can make a tick that resembles a lifter ticking when cold. If it's more of a singular tick like you seem to be having then the leak is most likely where a single cylinder is contributing to it, like the exhaust manifold gasket or possibly that manifold itself.