by John Keller | Mar 19, 2015 | Customer News, Fuel Price Management Solutions, Fuel Pricing Technology
Long-time PriceAdvantage customer Sheetz has opened two new locations in North Carolina this month, according to Convenience Store Decisions.
“Sheetz is experiencing a lot of growth companywide and we have done a tremendous amount of growth in the North Carolina market,” said Ryan Sheetz, director of brand strategy. “North Carolina is a great fit for us. We opened our 500th store in Thomasville and opened a second distribution center in Burlington last November.”
Sheetz has been using PriceAdvantage integrated to their Skyline signs since 2009. Since the beginning Sheetz has seen a significant ROI in maintenance service costs alone as you can read here.
Congratulations to Sheetz and their continued success. We’re honored to have such a long term partnership.
by John Keller | Mar 16, 2015 | Customer News, Fuel Price Management, Fuel Pricing Technology, Fuel Software, Industry News
The PriceAdvantage team would like to extend a warm welcome to E-Z Mart as our latest customer and partner. The PriceAdvantage solution at E-Z Mart includes out-of-the-box integrations with PDI and the VeriFone Sapphire POS.
“We wanted greater speed and control over our fuel pricing,” said Liff Luthringer, vice president of petroleum operations for E-Z Mart. “We chose PriceAdvantage because it allows us to push instant price changes from the store support center and more efficiently manage and analyze the data used in pricing decisions. More time is now available for analyzing the hard pricing decisions and finding ways to improve the performance of our fuel business.” E-Z Mart tested PriceAdvantage software at a few stores, Luthringer added, and “ran the numbers. We know that PriceAdvantage will make us faster and more competitive, and we are confident it will make us more profitable.” More information about the PriceAdvantage solution at E-Z Mart can be found here.
E-Z Mart is ranked number 34 on the Convenience Store and Fuel News Top 101 (link here) with 300 stores. Convenience Store News featured E-Z Mart as a cover story in their August 2014 issue, the online version of which is at this link.
by John Keller | Mar 14, 2015 | Fuel Price Management, Industry News, Retail Fuel Margins
According to an article in the Wall Street Journal today, the International Energy Agency announced Friday that US oil output was “surprisingly strong” in February, rapidly filling all available storage tanks. The agency said that US supply continues to “defy expectations”.
The reason is this: while independent shale-oil producers have slashed their planned 2015 spending on drilling by $50 billion year over year, they are increasing production on their best oil fields. Total US crude oil production again hit a high for the week ending March 6, reaching 9.4 million barrels a day.
And now many of these oil producers are adopting a new strategy that allows them to store oil in the ground, wait for the market price to rise again, and then quickly flood the market again. They simply drill the wells, which accounts for roughly 40% of the cost of the well’s total price, and then cap it until the right time when they can justify the remaining 60% investment to bring the oil to market. Plus many of these companies are betting that when it is time to produce from these capped wells, the services cost will be lower. This US oil under ground provides that much more storage beyond what is in the tanks above ground.
Add all this together and we see a scenario where it’s unlikely to have dramatically increasing oil prices anytime in the near future.
by John Keller | Feb 20, 2015 | Fuel Price Management, Industry News, Retail Fuel Margins
According to the Wall Street Journal today, we have an ongoing debate as to whether or not oil prices have hit rock bottom.
On one hand, we have seen the price of crude increase recently and now oil prices are back up above $50 a barrel. Oil producers in the US are reportedly cutting back on drilling, where the weekly count of rigs drilling for oil has dropped to the lowest level since August 2011, and oil companies have announced plans to lower their future spending. Aramco, the Saudi Arabia owned oil company, has announced they are considering cutting their future spending on production and exploration by up to 25%.
On the other hand, the US Energy Information Administration just announced that oil inventories increased by 7.7 million barrels in the week ending February 13. Their report said the US is on track to hit a 42 year high this month. Here we have an indication that output is not yet cutting back. And we’re in the middle of the annual February – March cycle where demand is at its lowest. In other words, oil supply continues to outweigh demand. Certainly it appears that in the near term, production will continue to keep us in an oversupply situation.
The ongoing US refinery strikes are three weeks old now, without any impact on gasoline prices. Refineries are hurt by roughly 200,000 barrels a day by the strike, and that amounts to a little over 1% of the daily US consumption which is 19 million barrels a day.
What does that mean from a fuel price management perspective? We’re seeing the traditional upward trend of springtime wholesale prices, along with upward trending retail fuel prices, and downward trending retail fuel margins. Gasoline futures also continue to rise. What remains to be seen is whether or not fuel volume demand repeats the strong numbers seen at the end of 2014. Retail fuel pricing competition remains strong, and the business is not for the weary. Retail fuel pricing software like PriceAdvantage is the way to the competitive edge.
by John Keller | Feb 12, 2015 | Fuel Price Management, Fuel Pricing Strategy, Industry News
According to the Wall Street Journal today, the US Energy Information Administration announced Wednesday that US crude stockpiles are at another record high. Oil companies are cutting back on their drilling investments and drilling activity has slowed, but the effects are not likely to be felt until the second half of this year, so say many experts.
The total quantity of oil in storage by companies such as refiners and traders is at the highest level in roughly 80 years. The US EIA stated in their weekly report that US oil production rose again to 49,000 barrels a day to 9.2 million barrels per day in the latest week, the highest level in reports dating back to 1983.
Oil prices dropped below $50 again to $48.84 per gallon on NYMEX. Gasoline futures fell by .91% while Diesel futures fell by 1%.
What does this mean from a fuel price management perspective? This is the season when refineries shut down plants for maintenance in anticipation of the higher demand months of summer. Usually that means refinery supplies lower and wholesale prices rise. Perhaps this year the inventory surplus will keep that wholesale increase at lower levels than years past, and lower oil prices will help suppress fuel price increases.
