| Greetings!
Sokolis Group wants to bring you value along every road and issue you travel. As with all of our issues we try to keep it brief and informative. For anyone buying fuel today, none of us has seen a more difficult time. A company like ours makes its money by helping companies buy their fuel better and we have never been busier.
Daily price changes of .05 - .20 cents per gallon make it challenging, even for experts, to make sure they are buying fuel at the right price.
Ideas for future issues are always welcome, along with any comments.
Glen Sokolis
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Sokolis Solutions
Fuel Survival Kit
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Improve Routing
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Stop Idling
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Quality Fuel Card
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Stay Informed about Fuel
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Tire Pressure
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Prevent Fraud; it's bad enough the prices are sky high
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Use Manufacturers Recommended Engine Oil
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Review Fuel Surcharge Program or Consider Using One. |
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Recommendations To Reduce Your Fleets Carbon Footprint:
1. Evaluate and reduce out- of-route miles
2. Increase asset utilization
3. Use the right truck for the right route and load demand
4. Set speed governor to no more than 68 mph
5. Join  |
DOE Prices
as of May 12, 2008
US = $4.331
East Coast = $4.377
New England = $4.463
Cntrl Atlantic = $4.516
Lower Atlantic = $4.310
Midwest = $4.298
GulfCoast = $4.268
Rocky Mtn = $4.276
West Coast = $4.454
California = $4.547
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NOT A SOKOLIS GROUP CLIENT?
Contact us online or call 267-482-6155
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OIL CLIMBS
We have all heard the expression, "The Ides of March", a metaphor for impending doom. How about "The Ides of May"? Since the close of business on May 1, crude oil has surged up from $112.52 bbl to $124.24 bbl, that's an 11% increase. Gas has risen from $2.8782/gallon to $3.1705, this is a 10% increase. Heating oil (which diesel is priced from) went from $3.1170/gallon to $3.628, a 16% increase. All of this change occurred in 15 days.
May 1 May 15
Gas $3.603 $3.776
Diesel $4.177 $4.455
Industry experts predict the National Average gas price of $4.00 could be just a couple of weeks away with states like: California, Connecticut, Illinois, Indiana, Michigan, New York and West Virginia already paying in the high $3.90's a gallon. The prediction for diesel is that it could top out at a National average of $5.00 with states like: California, Connecticut, New York, Pennsylvania and Rhode Island are already above $4.65 a gallon.
The volatility in the market is crazier than ever with Thursday's price swings more than $5.00 a barrel for crude and up 7 cents in heating at one point and down 7 cents at another to end at one penny up.
We had all better load up on the Tums because it is going to be a wild ride. |
Testimonial
John Maher, Director of Purchasing, Performance Transportation Services:
"We have saved more than $55,000 a month by using Sokolis Group."
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How Much Worse Can It Get For Oil?
How much worse can it get for oil in the short term? Let's count the latest news that seems to be driving up the prices.
1. Goldman Sachs came out with a major report predicting a possible oil super-spike to $200. per barrel and OPEC President Khelil agrees.
2. Rebel attacks further curb the supplies out of oil-rich Nigeria.
3. The U. S. Economy is stronger than expected, pushing up demand expectation. Of course, each time the dollar falls a penny, the price of a barrel rises by $4.00 and vice versa.
4. The election year has U.S. politicians talking about a gas windfall tax and tax amnesty.
5. Venezuelan production is off on strike and Hugo Chavez has fired over 20,000 oil workers.
6. The U.S. and Iran are fighting about nuclear energy.
7. Mexico has newly seen supplies from a major fall faster than expected.
8. The U.S. summer driving season is set to begin.
9. Sleeping giants: China, India and the Middle East continue their large thrust for oil.
10. Does anyone know when the Hurricane season starts?
There was a time when people thought that $80/ barrel was a high price for oil. Sokolis Group has had clients tell us that price was too high to hedge product. Heck, we probably didn't disagree. Who wouldn't want that $80/ barrel of crude today? In October 2008 are we all going to be saying who wouldn't want some of that $125/barrel crude?
We are in a time, just like the late 1990's with the tech sector, where in our minds we all though how could a start-up business with a pro-forma revenue have a higher market cap than GM? Well we all enjoyed it while it lasted. I am just not sure if we already experienced the good times or are these prices or higher a reality.
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Thinking Outside The Box
"When costs increase for everybody, you get a huge competitive advantage if you do something just a little bit differently," says Z. John Zhang, professor of marketing at the Wharton School, University of Pennsylvania. |
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Is Fuel Pressure Driving You Crazy?
According to the TMC of the American Truck Association only 43.6% of all tires are inflated within five PSI of proper air pressure. In the same study 21.6% of all vehicles had on tires under-inflated by 20 PSI or more. And you thought your fleet was on top of this? Another recent industry study from National Highway Traffic Safety Administration states that 30% of all vehicles including fleet cars had at least one tire that was 8 PSI or more under-inflated.
Does this cost your company money? You bet it does. A lot of money. Tires that contain too little air can lower your fuel economy by about .4% for every one PSI drop in pressure. Low tire pressure affects fuel economy by increasing the tires' rolling resistance, which makes the engine work harder to move the vehicle. Proper tire inflation can help increase fuel efficiency by up to 3.3%. You may ask yourself so how do I get there? Well it depends on what type of fleet you have, but here are some tips from several leading companies.
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Use a good quality digital tire pressure gauge. Have your driver check the pressure daily as they go through their pre-trip on a truck. Since your fuel cost is more expense than labor, its better to be safe than sorry. On smaller vehicles or cars have them check it once per week.
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FMCSA strongly suggests tire pressure monitoring and automatic inflation systems. The ROI on these devices for an average fleet was between one and two years but that was when fuel costs were $3.50 a gallon. Its much quicker now that we are paying roughly a dollar per gallon more than that.
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Alignment- have it checked make sure everything is rolling in the same direction.
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Tread -low tread will not help your fuel economy or your operation. Also, check for uneven wear, cuts, gouges or bulges in the sidewall.
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Load carrying capacity-make sure the tire matches the job.
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Tire Replacement- when needed, try to replace a pair if possible. Clearly, on bigger trucks and trailers, that is not always practical.
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Educate Drivers
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Invest in Technology
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But everyone a digital pressure gauge
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Drive Safely
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