by John Keller | Aug 3, 2010 | Fuel Price Management, Industry News
Crude oil today is trading $2 higher than yesterday at $81.34/bbl. Sweet crude futures for delivery in September traded at $81.43 a barrel early today. The price increase is attributed to the dollar weakening broadly, and to tropical storm Colin. Additionally, weekly inventory data is expected to show crude oil stockpiles in the United States fell last week.
Some analysts are now looking for crude to hit $87/bbl in 2010. There are 42 gal of oil in a barrel, and it takes between 1.5 and 2 gal of oil to make a gal of gas, depending on the refining process and type of oil.
by John Keller | Jul 29, 2010 | Fuel Pricing Technology, Industry News
In their latest “This Week In Petroleum” report, the US Energy Information Administration provides an interesting summary of the potential use of algae cultivation as an alternative fuel source. Algae has many attributes that make it potentially attractive as a future source of commercially produced fuel.
One of the most attractive aspects of algae as a fuel source is its high productivity. It would take 62.5 million acres of soybeans (an area approximately the size of Wyoming) to produce the same 3 billion gallons of oil that could be produced from only 2.5 million acres of algae (an area approximately 70 percent the size of Connecticut). Three billion gallons of biodiesel represent about 8 percent of all the diesel fuel used for on-road transportation in the United States in 2008.
Algae also has a much higher energy production rate than corn. Algae cultivation can produce 32 tons per acre resulting in 162 – 486 gigajoules of energy per acre, depending on cultivation techniques. Corn produces 8 tons per acre resulting in only 36 – 72 gigajoules of energy per acre.
And with algae, there is no competition between food production and fuel.
The National Renewable Energy Laboratory reports Honolulu, Phoenix and Denver as US cities who could theoretically be top producers of algal fuel.
Algae has the attention of the US Federal government, large energy companies, and venture capitalists who continue to fund demonstration projects and research into developing algae-based biofuels for commercial application. Current estimates of the production cost of algal oil range from $4 – $40 per gallon, depending on the type of cultivation system used. So while production of fuels from algae have been demonstrated, more research is needed before commercial scaling is realistic. But with all the research money being poured into this field, perhaps in the not-too-distant future we’ll have algae farms throughout the US contributing to our fuel source.
Sources: US EIA “This Week In Petroleum”; National Renewable Energy Laboratory “The Promises and Challenges of Algal-Derived Biofuels”
by John Keller | Jul 29, 2010 | Industry News, Retail Fuel Margins
The US Energy Information Administration weekly report revealed regional fuel price increases in the East Coast and Midwest drove up the national average overall. The U.S. average price for regular gasoline increased about three cents to $2.75 per gallon, $0.25 higher than a year ago. The average on the East Coast moved up two cents to $2.67 per gallon. The largest increase occurred in the Midwest where the average went up nearly four cents to $2.74 per gallon. The Gulf Coast increased less than four cents to $2.59 per gallon. The average in the Rocky Mountains was essentially unchanged at $2.75 per gallon. On the West Coast, the average rose a penny to $3.07 per gallon. Inching up a fraction of a cent, the average in California was virtually unchanged at $3.13 per gallon.
For the first time since the week of June 21, the national average price for diesel fuel increased, moving up two cents to $2.92 per gallon, $0.39 above last year.
by John Keller | Jul 28, 2010 | Fuel Price Management, Fuel Price Management Solutions, Fuel Price Optimization, Fuel Pricing Strategy, Industry News
These are good days to be in the retail fuel business. Valero announced in their Q2 results that their retail fuel operations segment had a record-setting performance with $109 million in operating income. These are the best second quarter results in Valero’s history. Valero reported their success is due to strong fuel margins at its gas stations and convenience stores.
A Fuel Executive for one of our PriceAdvantage customers reports they are up $2.4M so far this year. Other PriceAdvantage customers report recent months are some of the strongest ever.
In times like these, what do companies do to keep the momentum going? BJ’s Wholesale and High’s Dairy are investing in Fuel Price Management solutions from Skyline Products to automate their fuel pricing process to further improve speed to the street, and to maximize their fuel margins and profits. Shrewd companies like BJ’s and High’s recognize that using these strong profits to further optimize their fuel pricing strategies and to improve pricing efficiency is the way to make the most of these times of plenty.
by John Keller | Jul 22, 2010 | Fuel Price Management, Fuel Price Optimization, Industry News, Retail Fuel Margins
According to the US Energy Information Administration report issued July 21, the U.S. average price for regular gasoline fuel was, in essence, unchanged at $2.72 per gallon, $0.26 higher than last year. On a regional basis, price changes were mixed with the East Coast average dropping a penny to $2.65 per gallon. The Gulf Coast fell less than a cent to remain at $2.56 per gallon. The average in the Rocky Mountains moved up about a penny to $2.75 per gallon. Prices in the Midwest and on the West Coast increased about two cents to settle at $2.70 per gallon and $3.06 per gallon, respectively. The average in California went up nearly two cents to $3.13 per gallon.
The national average price for diesel fuel decreased for a fourth consecutive week. However, the price dropped less than half a cent and, consequently, remained essentially unchanged at $2.90 per gallon but was $0.40 above a year ago. Despite increasing by small fractions of a cent, the average prices in the Midwest and on the Gulf Coast were effectively unchanged at $2.87 per gallon and $2.86 per gallon, respectively. Prices on the East Coast and in the Rocky Mountains slipped a penny to $2.91 per gallon and $2.90 per gallon, respectively. The largest decline took place on the West Coast, where the average dipped a penny and a half to $3.04 per gallon. The average in California slipped less than a cent to stay at $3.12 per gallon.
by John Keller | Jul 15, 2010 | Fuel Price Optimization, Industry News, Retail Fuel Margins
According to the US Energy Information Administration, the U.S. average price for regular gasoline dropped for the second week in a row. The U.S. average price for regular gasoline slipped a penny to $2.72 per gallon. The national average was $0.19 higher than last year. With the exception of the Midwest, average prices declined in all regions of the country. On the East Coast and Gulf Coast, the averages each dropped more than a penny and a half, to $2.66 per gallon and $2.56 per gallon, respectively. Despite an increase of less than a half cent, the average in the Midwest was essentially unchanged at $2.68 per gallon. The average in the Rocky Mountains slipped over a cent to $2.74 per gallon. The West Coast average fell about a cent to settle at $3.04 per gallon and the California price dipped less than a half cent to $3.11 per gallon.