Fuel Prices will go lower, you bet. Or bet on it. See crude oil prices are down over $10 a barrel from almost $110 in the beginning of March. Now just 2 months later we are at $97 barrel. Sure retail gas stations and truck stops are holding their fuel margins as much as they can and would you blame them. The issue is diesel fuel and gas prices are running out of steam with lower crude oil prices.
The bottom on fuel prices are going to fall. Your fueling budget with look better soon. You will have fuel savings compared with today. Here is why:
- For every dollar crude oil price go up or down diesel fuel prices and gas prices go up or down equally by 2 or 3 cents per gallon.
- We are down $10 a barrel for curde oil prices. This woud translate into a 20-30 cent per gallon drop in diesel fuel prices off of highs 2 months ago. Diesel fuel pries are down only 10 cents a gallon from their highs.
- With gas prices they are trying to be held up with the summer driving season but gas prices have also only gone down about 10-15 cents per gallon.
- World wide demand is down for fleet fueling with Europe still trying to sort its word out and China demand down below expectations.
Retail margins across the country are up at truck stops like Loves Truck Stops, Travel Centers of America and Pilot Flying J locations. This is the way the truck stop business works, ride the highs and try to make something on the lows. C stores, cardlock locations all do the same thing.
Who blinks first? Well what goes up most go down. What diesel fuel prices go down. How far will diesel fuel go down, 15 cents in the next month unless something happens in Iran.
Gas prices will fall at least 10 cents a gallon. Hey, fuel savings to you from today’s prices. If your a fuel manager aren’t you happy? Your fueling budget is starting to look closer to what your fueling budget was when you did fuel budgeting 5 months ago. To us it looks like 25 cents fall a gallon by the end of the summer. Crazy. Sure! Does everyone have to step out on a ledge.
Take a review of your fuel management program. The question is are you ready as a fuel manager or CFO for fueling prices to fall quickly. Your saying, yes we want lower fleet fueling prices what is it to be ready? Well now is the time to make sure you know what your fleet fueling margins are. As fleet fueling prices go down you want to make sure that the fuel margin that you are being charge go down just as quick.
If your fuel management solutions are in the shape you think they are in, this is already happening. If they are not in good shape, your company is tossing money away. No throwing money away. It might be pouring money away. Who has the fuel auditing at your company? The fueling negotiations, the fuel card information and to determine your fuel baseline saving.
Need help? Got fuel? You probably need help. Have you heard of Sokolis?
Gain instant access to the ebook!