If you have any doubts about the future direction of fuel prices, pay attention to what’s happening today.
Don’t be lulled by the fact that the average price for a gallon of diesel has declined to $2.185 a gallon, well below the record of more than $4.75 set in July. Don’t let the first whiffs of economic revival mask the inevitable return of fuel-price increases.
A barrel of crude oil on New York’s Mercantile Exchange hit almost $57 last week, reaching its highest trading level since November. Crude prices have now risen 18% during 2009, even as year-over-year demand for diesel is 18% below year-ago levels and as crude stocks have reached their highest levels since 1990.
Last week’s crude prices apparently were sparked, at least in part, by Ben Bernanke, chairman of the Federal Reserve, when he made some very measured statements about what he termed the early stages of economic healing.
Bernanke said the housing market is beginning to stabilize and that the sharp reduction in business inventories noted during the first quarter was apparently nearing an end.
One can only guess what would have happened to crude oil prices if Bernanke had made more positive comments.
Commodities speculators apparently are convinced that the tight supply situation that helped push crude prices to $120 a barrel a year ago will quickly reappear when the worldwide recession ends.
Prudent trucking fleets won’t relax their efforts to improve their fuel efficiency, efforts that began when fuel prices went haywire.
Even as lower prices have made it harder for fleet executives to shell out money to improve fuel use, our fuel story this week shows that some are moving ahead with their efficiency programs.
Failure to act now could lead to a repeat of what happened to many fleets when fuel prices went on a rampage not so long ago.
As a nation, we are no better prepared to cope today than we were last year, when records were being set even as the world slid into the recession.
Thus, prudent fleet executives need to prepare now for the higher fuel prices that we know are coming.
If you are a fleet executive and you are playing the game of chess with fuel prices, what’s your next move? Do you have one? Are you feeling sleepy because you are forgetting about the fuel prices, like others before forgot about the hurricanes?
My next move as a fleet executive, fuel manager, fuel buyer would be to hire the Sokolis a fuel management and fuel consulting company. You are saying to yourself of course that is what you would say but hear me out. Today fuel prices are low, not as low as a couple of months ago but still low. Do you know how well you are doing today with the way you buy fuel? Or are you stabbing at it like so many fleets do?
If you had legal issues would you try to read the documents yourself and sign off on them? I don’t think you would so now is the time to have a fuel expert, look at your fuel program. Sokolis will review your fuel buying process, fleet fuel cards, discount fuel program.
You will be able to rest easy to know a fuel management and fuel consulting team is working to solve all your fuel price issues and headaches.
Sokolis is a fuel management and fuel consulting company. 267-482-6155 or www.sokolisgroup.com
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