SOKOLIS GROUP WINTER FUEL TIPS

• Replace fuel filters at manufacturer recommended intervals.  Particles in the filter make it easier for wax to gel.  Use the highest OEM accepted micron filter possible.
• Keep your fuel tanks full and free of water.  Cold air on top of warm fuel creates condensation.  This can be reduced by limiting the amount of space in your tanks.
• Test any bulk tanks for water.  Water freezes faster than the wax in the fuel.  If your fuel has 100 ppm or higher water content, it should be treated with a drying agent.
• Drain fuel water separators weekly and be sure to monitor them even between scheduled maintenance.
• Open the drain at the bottom of the fuel tanks to drain off any water &/or sediment.
• If your vehicle is going to be idle for long periods of time (4 hours or more) you may want to install a fuel heater or find heated parking.  Moving liquid takes longer to freeze than stationary liquids.  Keep your fuel moving or keep it warm.
• Tighten all fuel tank mountings and brackets. At the same time, check the seal in the fuel tank cap, the breather hole in the cap, and the condition of the flexible fuel lines.  Repair or replace the parts, as necessary.
• After your vehicle has been off the road for an extended period, start and let the engine idle for 30 or more minutes allowing warm fuel to return to the fuel tanks to break up any wax buildup.

DEF (Diesel Exhaust Fluid) and cold weather

• DEF is required to remain pure to operate correctly.  Additives should never be added to DEF.
• DEF freezes at 12 degrees F.  The 32.5% urea concentration in DEF allows both the urea and water to thaw at the same rate, therefore keeping the solution from being diluted or over concentrated.
• SCR systems are designed to provide heating to the supply tanks and lines during normal operation.  If the DEF freezes when the vehicle is idle, normal start-up and operation will not be inhibited.  The DEF will thaw as the vehicle is operated.  Freezing and thawing will not degrade the product.

If you need additional help or suggestions on your winter fuel program, please contact Conor Proud at 267-482-6159 or cproud@sokolisgroup.com.  For further help with your fuel management program or to lower your fuel cost, visit us at www.SokolisGroup.com.

Oil prices traded in a very narrow range during most of October following a short period of significant volatility during September.  October’s prices opened and closed the month at just over $54 per barrel.  The following graph shows the daily price movements over the past three months:

September’s volatility was caused by an attack on Saudi Arabia’s oil refining facilities during the middle of the month.  Prices spiked immediately following the attack.  However, concerns about supply disruptions in the Middle East quickly abated when it became clear that a retaliatory military response would not occur.  The refinery that was attacked was also able to resume limited production in a relatively short time. 

As tensions lowered, prices declined through the last half of September and remained in the low $50’s for most of October.  There were few developments in October to impact prices until the last week of the month.  During that time, prices showed modest growth as OPEC indicated it would consider the possibility of making deeper productions cuts to help support higher prices.  In addition, US oil inventory levels declined unexpectedly after an extended period of increases.  The bump in prices lost momentum as the unresolved US-China trade war continued to limit optimism about future global economic activity and its related demand for oil.

Due to the way prices declined during the last half of September while remaining lower through October, overall average prices for oil decreased slightly.  Despite the decline, average wholesale and retail prices for diesel increased slightly as demand remained strong.  Meanwhile, gas wholesale prices were flat while retail prices increased.  The increase in the gas retail average was primarily influenced by supply disruptions on the West Coast as several refineries dealt with maintenance issues.  The graphs below show the movement of crude oil (converted to gallons) along with wholesale and retail fuel prices over the trailing 15 months:  

Since retail and wholesale prices for diesel moved in sync, margins were relatively unchanged.  For gas, retail margins increased modestly as retailers found opportunities to increase their prices slightly while wholesale prices remain flat.  For both fuels, retail margins continue to be at more typical levels although gas margins are on the higher end of their usual range.  The following graph shows the margins for over the trailing 15 months: 

Looking toward the remainder of the year through the start of 2020, Sokolis Group continues to anticipate that oil prices will climb back to $60 or more per barrel.  As we have previously noted, there are multiple factors that support rising prices even before considering the possibility of future conflicts in the Middle East.  Prices could be driven higher as oil inventories have recently shown a declining trend while OPEC and Russia are considering deeper production cuts.  In addition, the deadline for the IMO 2020 maritime fuel transition is approaching which is anticipated to increase demand for oil and diesel fuel. 

It’s also important to consider that even if oil prices do not increase significantly over the next few months, wholesale and retail prices for refined fuels could still increase, particularly for diesel.  The margin between the cost of oil versus the wholesale cost of refined fuels is commonly measured as the “crack spread.”  The 3:2:1 crack spread is based on producing two barrels of gas along with one barrel of diesel for every three barrels of oil.  The following graph shows the 3:2:1 trend over the trailing 15 months:

The trend shown above reflects some variation, but the spread has been running higher since the spring of this year.  Generally, the spread can be driven higher when demand for fuels increases while refining and distributing capacity is limited.  This can occur due to unexpected disruptions to refineries and distribution networks which often result from storms and fires as we have recently seen.  Planned disruptions also take place, such as during this time of year when refineries typically shut down for short periods to perform preventive maintenance tasks while also shifting production for winter blends of gasoline. 

As mentioned above, demand for diesel fuel is expected to increase from IMO 2020 while demand for heating oil (essentially diesel fuel) will be increasing during the colder months.  Therefore, in addition to our view that the underlying price of oil is likely to increase, we also believe greater demand for diesel will cause the crack spread to increase.  The result will be higher fuel prices for the foreseeable future.

If you’re concerned about the impact of future fuel price changes for your fleet and want to know if you’re receiving the best fuel prices possible, contact Conor Proud at Sokolis Group, cproud@sokolisgroup.com or 267-482-6159.  We are the nation’s leading independent fuel management consulting team and can help you make sure that your fuel management program is running at peak efficiency. 

September had a volatile period for oil prices following a relatively stable stretch for most of August.  The month opened with prices near $55 per barrel but sharply increased to over $62 during mid-September.  Shortly after the spike, prices quickly fell back to the mid-$50’s and remained in that range.  By the end of the month, prices closed just over $54, roughly where the month began.  The following graph shows the daily price movements over the past three months:

In early September, prices started climbing modestly as OPEC reaffirmed their production cuts through the end of the year.  Then, a rapid and significant increase in prices occurred during the middle of the month following a missile and drone attack on Saudi Arabia’s oil refining facilities, attributed to rising tensions with Iran.  Concerns about escalating military action in the Middle East in retaliation for the attack along with expectations of a major disruption to oil supplies caused the spike in prices.  The Saudi facilities had been producing approximately 5% of the world’s oil and initial estimates of the damage indicated it would take many months to restore full operations.  

Although it appeared that prices might continue climbing after the attack, they quickly began to decline when a military response did not occur despite continuing accusations of blaming Iran and high tensions in the region.  In addition, Saudi Arabia reported they were able to quickly restore a large amount of production capability and claimed that full operations would resume within weeks. 

As a result of the events in September, overall average prices for oil and wholesale fuels increased compared in August.  However, diesel retail prices remained flat while gas retail prices continued their slow decline that began in the spring.  The graphs below show the movement of crude oil (converted to gallons) along with wholesale and retail fuel prices over the trailing 15 months:  

Since retail prices for diesel were relatively unchanged while wholesale prices increased, retail margins for diesel decreased.  Retail prices and margins for diesel had been relatively high over the past few months so the increase in wholesale prices was essentially absorbed at the retail level as merchants sacrificed their unusually high margins.  For gas, retail margins also decreased as average retail prices continued their slow decline while wholesale prices remained relatively stable.  For both fuels, retail margins have returned to more typical levels.  The following graph shows the margins for over the trailing 15 months: 

Looking toward the remainder of the year, Sokolis Group continues to anticipate that oil prices will climb back to $60 or more per barrel.  The ongoing tensions in the Middle East certainly create the possibility of even higher price spikes.  There have also been some reports doubting the Saudi’s ability to fully restore production as quickly as they have indicated which could tighten supplies as inventory levels decline. 

As we have previously noted, there are several additional factors that support rising prices; OPEC and Russia have extended their production cuts through the end of the year, and possibly into 2020, in their effort to tighten supply.  Plus, face-to-face negotiations toward resolving the US-China trade conflict are scheduled for October.  Lastly, the deadline for the IMO 2020 maritime fuel transition is approaching which is anticipated to increase demand for oil and diesel fuel. 

If you’re concerned about the impact of future fuel price changes for your fleet and want to know if you’re receiving the best fuel prices possible, contact Conor Proud at Sokolis Group, cproud@sokolisgroup.com or 267-482-6159.  We are the nation’s leading independent fuel management consulting team and can help you make sure that your fuel management program is running at peak efficiency. 

August opened with oil prices just over $58 per barrel but they fell sharply during the first week of the month.  By the 7^th of the month, prices hit their lowest point at $51 and then started to rebound.  For the remainder of the month, prices traded in a narrow range near $55 which is where the month finally closed.  The following graph shows the daily price movements over the past three months:

Within a few days following the start of August, prices rapidly declined after an unexpected burst of friction between the US and China regarding their trade dispute.  Oil prices and financial markets plummeted based on a renewed pessimistic outlook for future global economic activity and demand for oil.  Although prices rebounded shortly after the decline, the following two weeks reflected little change.  By the last week of August, prices found some support as oil inventory levels showed a large decline.  In addition, the tone between the US and China began to soften ahead of face-to-face talks scheduled for September.

Overall average prices for oil and wholesale fuels declined in August compared to July.  Diesel retail prices continued a slow decline that began in May.  Gas retail prices fell slightly slower than the wholesale decline.  The graphs below show the movement of crude oil (converted to gallons) along with wholesale and retail fuel prices over the trailing 15 months:  

Due to the way average wholesale prices decreased a bit slower than retail, margins increased modestly and remained at relatively high levels during August.  The following graph shows retail margins for diesel and gas over the trailing 15 months: 

Despite the decrease in oil and fuel prices during August, Sokolis Group continues to anticipate that oil prices will reach $60 or more per barrel as we look across the remainder of the year.  Although the chances of resolving the US-China trade conflict had been fading, any progress toward reaching a deal will support rising prices.  And, we believe it is more likely there will be some progress over the next few months rather than a total collapse in negotiations. 

Other factors continue to support rising prices including ongoing tensions in the Middle East with Iran.  Also, OPEC and Russia have extended their production cuts through the end of the year, and possibly into 2020, in their effort to tighten supply and support prices.  Lastly, the deadline for the IMO 2020 maritime fuel transition is approaching which is anticipated to increase demand for oil and diesel fuel. 

If you’re concerned about the impact of future fuel price changes for your fleet and want to know if you’re receiving the best fuel prices possible, contact Conor Proud at Sokolis Group, cproud@sokolisgroup.com or 267-482-6159.  We are the nation’s leading independent fuel management consulting team and can help you make sure that your fuel management program is running at peak efficiency. 

The month of July opened with oil prices approaching $60 per barrel.  By the 10^th of the month, prices climbed slightly over $60 and remained at that level for a few days.  However, prices fell back to the mid-$50’s as the second half of the month started.  Prices subsequently traded in a narrow range near $56 during the last 10 days of the month but finally closed the month over $58.  The following graph shows the daily price movements over the past three months:

The start of July followed a significant increase in oil prices during the last half of June.  That increase was driven by political tensions in the Middle East along with optimism about the US and China agreeing to resume trade talks.  Prices lost some momentum in early July but resumed increasing as the middle of the month approached.  The increases were based on inventory levels declining along with a weak hurricane in the Gulf Coast that raised concerns about supply disruptions.

Heading into the last half of July, prices began to quickly fall toward the mid- $50’s.  The decline was attributable to several factors; the Gulf Coast storm passed without a significant impact to supplies, tensions in the Middle East were somewhat reduced, and news about China’s slowing economy indicated potentially weaker global demand for oil. 

During the last week of July, prices rose again as inventory levels continued to decline.  In addition, optimism grew regarding global economic activity and future demand for oil; the US and China began face-to-face talks to resolve their trade dispute, plus the US Federal Reserve reduced interest rates.

Average prices for oil and wholesale fuels were slightly higher in July compared to June primarily because prices had risen quickly during late June.  However, the typical lag in retail prices resulted in trends that did not reflect the underlying wholesale price movements.  Diesel retail prices continued a slow decline that began in May while gas retail prices were flat compared to the previous month.  The graphs below show the movement of crude oil (converted to gallons) along with wholesale and retail fuel prices over the trailing 15 months:  

Due to the way average wholesale prices increased in July while retail prices lagged, retail margins declined, although they were still at relatively high levels.  The following graph shows retail margins for diesel and gas over the trailing 15 months: 

As we look toward the second half of the year, Sokolis Group continues to anticipate that oil prices will reach $60 per barrel and potentially climb beyond the mid-$60’s.  As we have previously noted, prices are likely to increase based on factors that include a potential resolution of the US-China trade conflict, extended production cuts by OPEC and Russia, tensions in the Middle East, and compliance with IMO 2020. 

If you’re concerned about the impact of future fuel price changes for your fleet and want to know if you’re receiving the best fuel prices possible, contact Conor Proud at Sokolis Group, cproud@sokolisgroup.com or 267-482-6159.  We are the nation’s leading independent fuel management consulting team and can help you make sure that your fuel management program is running at peak efficiency. 

Oil prices hovered near $53 per barrel for most of June, then quickly increased toward $60 during the last 10 days of the month.  Prices closed the month at over $58 after increasing $5 during late June, or 9%.  Overall, prices are up almost 30% since the start of the year.  The following graph shows the daily price movements over the past three months:

The start of June followed a significant decline in oil prices during the last week of May.  Prices fell sharply in May because of a pessimistic outlook for future oil demand resulting from ongoing trade tensions between the US and China along with a new US trade rift with Mexico.  In addition, oil inventories unexpectedly began increasing despite ongoing production limits implemented by OPEC and other countries attempting to balance global oil supply and demand.

As June began, a trade agreement was quickly reached between the US and Mexico but that development was not enough to support an increase in oil prices.  This positive event was offset by the lack of progress related to the US-China trade conflict along with inventory levels that continued to rise.  Even attacks on oil tankers in the Persian Gulf during early June had little upward impact on prices.

Near the end of the 3^rd week of June, two primary factors caused prices to rise rapidly; the first was an announcement that the US and Chinese leaders would meet during the G20 summit at the end of June to discuss trade.  The second factor quickly followed when news broke that Iran had shot down a US drone under questionable circumstances.  The combination of the positive development in the US-China trade conflict, which could increase demand for oil, followed by the possibility of an escalating military conflict in the Middle East, which could decrease supply, caused prices to rapidly increase.

Further support for rising prices came from news that oil inventories started declining in late June.  Additionally, an explosion and fire at a Philadelphia refinery, one of the largest on the East Coast, resulted in a decision to shut down the facility indefinitely.  The refinery was a large producer of gasoline for the Philadelphia and neighboring eastern markets and the disruption in supply elevated prices for gas in those areas.

Although prices rose quickly near the end of June, averages for the entire month were much lower than May.  The significant decline at the end of May resulted in lower prices for most of June which impacted the averages.  However, retail prices did not fall as quickly as wholesale which is typical when prices are declining quickly.  The graphs below show the movement of crude oil (converted to gallons) along with wholesale and retail fuel prices over the trailing 15 months:  

Due to the way average wholesale prices declined in June while retail prices lagged, retail margins increased significantly.  In fact, margins reach their second highest level in many years.  The following graph shows retail margins for diesel and gas over the trailing 15 months: 

As we look toward July and the second half of the year, Sokolis Group expects oil prices will reach $60 per barrel and potentially climb beyond the mid-$60’s.  Gasoline prices will continue to feel upward pressure during the remainder of the summer driving season, particularly on the East Coast, as a result of the refinery closure until alternate supply sources are normalized. 

The primary near-term driver for rising prices is news from the meeting between the leaders of the US and China at the end of June that they are taking positive steps to reengage negotiations to end their trade dispute.  In addition, OPEC and Russia have recently indicated they are considering an extension to their production cuts in order to keep supplies tight for the remainder of the year.

As we’ve previously noted, prices are also likely to begin climbing again during the second half of the year based on several contributing factors besides any potential resolution of the US-China trade conflict.  The production cuts by OPEC and Russia may start to have an impact on balancing global supply, tensions in the Middle East could worsen, and compliance with IMO 2020 requiring ships to burn cleaner fuel will increase demand for diesel fuel.

If you’re concerned about the impact of future fuel price changes for your fleet and want to know if you’re receiving the best fuel prices possible, contact Conor Proud at Sokolis Group, cproud@sokolisgroup.com or 267-482-6159.  We are the nation’s leading independent fuel management consulting team and can help you make sure that your fuel management program is running at peak efficiency. 

Oil prices traded in a narrow range near $62 per barrel for most of May, then quickly fell back to the high-$50’s on May 23^rd.  Prices collapsed even further at the end of the month, closing May at $53.50.  Overall, prices fell by 16% during May but are still up by 13% since the start of the year.  The following graph shows the daily price movements over the past three months:

Despite ongoing tensions in the Middle East, the stage was set for May’s price decline as a result of the breakdown in trade talks between the US and China.  However, the main catalyst for the rapid decrease on the 23^rd was unexpected news that global oil inventory levels had increased.  Analysts had been expecting declines based on seasonality along with OPEC’s production cuts. 

Prices declined because inventory levels were not shrinking as fast as expected from OPEC’s production cuts and this was compounded by the bearish outlook for future oil demand due to the ongoing trade tensions.  The situation with the US and China continued to worsen throughout the end of the month.  Then, things got worse as a new front of trade tensions began with the US and Mexico.  The overall pessimism about global economic activity and weakening demand for oil ultimately caused prices to collapse.

As oil prices fell quickly during the end of May, average wholesale and retail prices for diesel and gas did not keep pace.  The overall wholesale averages for these refined products were relatively unchanged compared to April.  May’s average retail prices, which are typically slow to respond rapid changes, continued to increase compared to April.  The graphs below show the movement of crude oil (converted to gallons) along with wholesale and retail fuel prices over the trailing 15 months:  

Due to the way wholesale prices remained steady while retail increased slightly in May, average retail margins also increased slightly.  Any declines in retail prices probably won’t be noticeable until a week or two into June. And during this period, above average retail margins will likely occur until the market stabilizes at its new lower level.  The following graph shows retail margins for diesel and gas over the trailing 15 months: 

Sokolis Group anticipates oil prices will remain in the mid-$50’s per barrel through the summer months unless any trade agreement breakthroughs are announced.  Assuming no positive changes to trade, prices are still likely to begin climbing again during the second half of the year.  Significant factors to continue to watch include production cuts by OPEC and Russia that may start to have an impact on balancing global supply, tensions in the Middle East could worsen, and compliance with IMO 2020 requiring ships to burn cleaner fuel will increase demand for diesel fuel. 

If you’re concerned about the impact of future fuel price changes for your fleet and want to know if you’re receiving the best fuel prices possible, contact Conor Proud at Sokolis Group, cproud@sokolisgroup.com or 267-482-6159.  We are the nation’s leading independent fuel management consulting team and can help you make sure that your fuel management program is running at peak efficiency. 

During the first half of April 2019, oil prices traded in a narrow range in the low $60’s per barrel, then started rising to a recent high just over $66 on April 23^rd but fell below $64 by the end of the month.  Prices increased by almost 6% during April and are up by 37% since the start of the year.  The following graph shows the daily price movements over the past three months:

The increase during the third week of April was primarily driven by the US’s announcement that it would not extend the waivers it had previously granted to eight countries purchasing Iranian oil.  Although Iran’s contribution to global oil supply had already been significantly curtailed, the expiration of waivers could potentially tighten the market even further.  Oil has been rising since the beginning of the year as a result of OPEC and Russia operating at reduced production levels in their effort to balance the market and support prices.  The expiration of Iranian waivers heightened concerns about diminishing supplies.  However, toward the end of the month, prices retreated as OPEC members indicated they would increase production to offset the loss of Iranian supply.

As oil prices increased overall during April, average wholesale and retail prices for diesel grew at a similar pace.  However, wholesale and retail prices for gas increased faster.  Demand for gas has been growing which is typical during this time of year as driving increases when the weather gets warmer.  The graphs below show the movement of crude oil (converted to gallons) along with wholesale and retail fuel prices over the trailing 15 months:  

Due to the way diesel wholesale and retail prices moved in sync during April, average retail margins only declined slightly. For gas, margins rebounded from their very low point last month and are approaching a more typical level.  The following graph shows retail margins for diesel and gas over the trailing 15 months: 

Sokolis Group anticipates oil prices will remain in the low- to mid-$60’s per barrel for the next month or two but further increases are very likely during the second half of the year.  As we’ve previously indicated, many factors continue to support rising prices.  These include production cuts by OPEC and Russia, economic sanctions on Iran and Venezuela, a potential trade agreement between the US and China, along with IMO 2020 requiring ships to burn cleaner fuel. 

If you’re concerned about the impact of future fuel price changes for your fleet and want to know if you’re receiving the best fuel prices possible, contact Conor Proud at Sokolis Group, cproud@sokolisgroup.com or 267-482-6159.  We are the nation’s leading independent fuel management consulting team and can help you make sure that your fuel management program is running at peak efficiency. 

During March 2019, oil prices traded near $56 per barrel for the first half of the month.  Near the middle of the month, prices quickly jumped over $58.  For the remainder of the month, prices traded in a narrow range near $59 and managed to close just over $60 by the end the month.  Overall, prices rose by 5% during March and have increased by approximately 33% during the first quarter of 2019.  The following graph shows the daily price movements over the past three months:

The overall increase during March was primarily caused by tighter oil supplies as a result of OPEC and Russia operating at reduced production levels.  In addition, OPEC decided not to hold a meeting in March to reevaluate production, thereby, continuing forward with reduced daily output.  Higher prices resulted from anticipation that supply and demand will reach a balance, followed by the market becoming under-supplied later in the year.

As oil prices increased during March, average wholesale prices for diesel and gas also increased.  Retail prices for diesel increased at a similar rate as wholesale prices.  However, gas retail prices increased at a much slower pace.  The graphs below show the movement of crude oil (converted to gallons) along with wholesale and retail fuel prices over the trailing 15 months:  

Due to the way diesel wholesale and retail prices moved in sync during March, average retail margins remained flat. For gas, lagging retail prices caused margins to sink below $0.10 per gallon which is one of the lowest levels in years.  The following graph shows retail margins for diesel and gas over the trailing 15 months: 

Sokolis Group anticipates oil prices will remain near $60 per barrel for a short-term period but will likely increase further during the second half of the year.  As we’ve previously indicated, many factors support rising prices.  These include production cuts by OPEC and Russia, economic sanctions on Venezuela and Iran, a potential trade agreement between the US and China, along with IMO 2020 requiring shipping vessels to burn cleaner fuel. 

If you’re concerned about the impact of future fuel price changes for your fleet and want to know if you’re receiving the best fuel prices possible, contact Conor Proud at Sokolis Group, cproud@sokolisgroup.com or 267-482-6159.  We are the nation’s leading independent fuel management consulting team and can help you make sure that your fuel management program is running at peak efficiency. 

During February 2019, oil prices traded in a narrow range during the first 10 days, then began climbing for the remainder of the month.  Prices opened the month at just under $54 per barrel and closed at just over $57, a 6% increase.  The following graph shows the daily price movements over the past three months:

The overall increase in prices during February was primarily caused by news that the US and China were making progress in negotiations to resolve their trade war.  The positive updates supported the belief that greater economic activity could be anticipated in the future which would generate more demand for oil. 

The only exception to the rising trend near the end of the month was a downward blip attributed to President Trump’s tweet encouraging OPEC to hold down prices.  However, attention quickly returned to the fundamentals over the last few days of the month; demand continues to be strong, inventories showed significant declines, and prices resumed their climb upward. 

As oil prices increased during February, the average wholesale prices for diesel and gas also increased.  However, retail prices for diesel and gas were slow to move higher.  The graphs below show the movement of crude oil (converted to gallons) along with wholesale and retail fuel prices over the trailing 15 months:  

As oil continued to increase along with wholesale prices, lagging retail prices pinched retail margins.  Although margins remain elevated, they are now within a more typical range.  The following graph shows retail margins for diesel and gas over the trailing 15 months: 

Sokolis Group anticipates oil prices will remain in the mid-to-high $50’s for the foreseeable period but will likely increase to $60 and beyond by the second half of the year.  There continue to be many factors to support rising prices.  These include production cuts by OPEC and Russia, economic sanctions on Venezuela and Iran, a potential trade agreement between the US and China, along with IMO 2020 requiring shipping vessels to burn cleaner fuel. 

If you’re concerned about the impact of future fuel price changes for your fleet and want to know if you’re receiving the best fuel prices possible, contact Conor Proud at Sokolis Group, cproud@sokolisgroup.com or 267-482-6159.  We are the nation’s leading independent fuel management consulting team and can help you make sure that your fuel management program is running at peak efficiency.