Gas Prices All Time High For This Time of Year

U.S. drivers are now paying more for gas prices to fill their tanks than they ever have at this time of year. I don’t know about you, I really haven’t paid that much to gas prices lately. This seems a little strange right for a guy who is a fleet fuel expert and owns the largest fuel management company in the country.

I paid $3.40 a gallon yesterday when I filled up my Ford Fusion. It didn’t make me jump up and shout or think I was going to hit my limit on my fuel card or anything. It seemed fine. I mean at one time, if gas prices were over $3.00 a gallon, you thought your fleet fuel card was going to explode. Now, I guess it take something over $3.75 a gallon for gas prices in my head.

I mean after all, we have all paid over $4.00 a gallon in our fleet fuel for gas prices over the past few years.

The national average price of retail gasoline posted its biggest overnight increase in 23 months, rising four cents to $3.462 a gallon on Friday, according to AAA. A funny tidbit AAA is a client of Sokolis for its diesel fuel buying and gas buying. The average cost for gas prices have risen 13 cents in the past week, a 4 percent jump.

“This is the highest price record for February 1st,” says Oil Price Information Service (OPIS) analyst Tom Kloza, who predicts the average price could reach $3.50 a gallon this weekend. I have known Tom for more than 15 years and was at an OPIS conference that he spoke out about 4 months ago and he thought we could see gas prices under $3.00 a gallon. I guess he is a little surprised by these extra costs on his fuel card too.

NYMEX March RBOB gasoline futures, which help determine prices at the pump, have risen 10 percent in the past two weeks to a session high of $3.045 a gallon on Friday.

“Refinery issues and speculation about refinery issues has with a lot of money betting on still higher prices,” OPIS analyst Kloza says. Tom will always say this is what I see happening in the market now and over the next x period but he also says that can change quickly.

Oil producer Hess announced earlier this week that it is shutting its refinery in Port Reading, N.J., by the end of February. That refinery accounts for about 7.5 percent of oil production on the East Coast at about 70,000 barrels per day. Philadelphia Energy Solutions is also set to begin planned maintenance at its 335,000 barrel per day Philadelphia refinery. Ouch. Get ready to pay more for gas prices in this area quickly. For a fleet manager over seeing a gas fleet management program, he will be worried about his fuel budget.

Traders and analysts forecast the closure and maintenance of refineries near the New York Harbor will further tighten gasoline supplies in the region. Planned maintenance in other parts of the country also add to concerns about gasoline supplies.

Meanwhile gasoline demand is on the rise. While total U.S. gasoline supplies fell by 1 million barrels last week, gasoline demand increased by 70,000 barrels a day to the highest level since the end of December.

Fuel management analysts say the U.S. Labor Department’s upward revision to payroll data on Friday is further indication of steady economic growth and will lead to continued increases in gasoline demand. The number of non-farm jobs added in November was revised sharply higher from 161,000 to 247,000, while the figure for December was upgraded from 155,000 to 196,000.

“Significant upward revisions for 2012 and last two months of the year in particular are showing up in the increase in gasoline demand,” says John Kilduff, founder of Again Capital. “Improvement in employment is going to be supportive of gas prices.”

More people with jobs will produce higher gas prices? That makes sense with all of this other fleet fuel stuff going on but I can tell you, we still don’t by as much gas today as we did just a couple of years ago.

Worried about your companies gas prices or diesel fuel prices call 267-482-6155. Or contact us at www.sokolisgroup.com we don’t want your fuel card explode or your fuel management program, let our fuel manager services and experts help YOU.