Oil Prices Don’t Know Which Way is Up

With a DOE report today that showed Benign U.S. Supply Data, the price of fuel remained flat. Flat Fuel? Fuel going flat? Fuel going higher? The problem is fuel just does not know what to do with itself.

You still have record high inventory out there with a fairly weak economy. This leads to lower fleet fuel prices right? Well not so quick. The price of crude oil has doubled since the beginning of the year and that has thrown off some people’s fuel planning. A guy the other day told me that he had budgeted his whole year’s fuel costs from last December’s price. I said, why did you do that? He said, “That’s what the fleet fuel price was at the time, how did I know what it was going to do.” Maybe it’s my common sense or maybe my fuel management skills or being around fuel consulting all of my life but that was just stupid on his part. He should have at worse taken an average of last years pricing to come up with his fuel budget for 2009. Talk about a guy that should have hired a fuel consulting firm.

Traders were also eyeing news that big oil producers are increasing fuel output. Russian oil output hit a record high in August, nearing 10 million barrels per day as the country launched a new giant field, while gas production recovered from its lows on improved demand. Does OPEC have a little cheating going on? The next OPEC meeting is set for September 9 and it is highly unlikely that they will raise or cut production.

Oil sank almost $5 a barrel in the first two days of this week on worries that a global economic recovery this year would be slow and may not justify the big rallies in stocks and commodities since March.

See what I mean. After reading this article you’re probably just as confused as oil. When trying to arrange your fuel planning in the coming weeks, just figure we will float around this $65 to $72 a barrel range, though gas prices are up 5 cents since last month. Great news, they are $1.08 less than last year. Do you know where to go for your fuel management needs? Who is going to help you with your fuel planning when it comes to your fleet fuel? Only one fuel consulting company can handle you with the first class service you deserve and that’s Sokolis Group.

Sokolis Group for all of your fuel planning, fleet fuel program, fuel management and fuel consulting needs @ 267-482-6155 or www.FuelManagementSokolisGroup.com. Do you want quick short fuel updates. Twitter us @SokolisGroup.

Leave a Reply

Your email address will not be published. Required fields are marked *