You’ve heard that the price of a barrel of oil is increasing, how does that correspond to the price of gasoline?

Use the calculator below to get a better idea.

Gas Calculator: Predict Gasoline Fuel Price from Crude Oil Price

Notes:

It takes 3-6 months for crude oil to make its way through the refining process and make it into gasoline that you buy at the pump. Due to this delay, you may not see an immediate jump in pump prices.

This assumes that there are no disruptions in refinery capacity. If a refinery is disrupted, as happened during Hurricane Katrina, then you should expect the price you pay at filling stations to increase beyond the estimates here. Similarly, if taxes change, that will be reflected in the fuel price.

The pump price will also vary depending on your geography.

 

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Thought this was interesting:

April 13th, 2011

Goldman Sachs rocked oil markets for a second day Tuesday by calling for a nearly $20 fall in Brent crude oil, saying speculators had pushed prices ahead of fundamentals. It was the second warning of a steep market reversal from the long-term commodity bull in as many days. On Monday, Goldman recommended clients close a trade heavily weighted toward U.S. crude futures.

I’ve never been one to say that speculators are the primary driver of oil price fluctuations. Fundamentally, we are at or near the peak in conventional oil production — and that means oil prices will inevitably see higher highs and higher lows (See Science: “Peak oil production may already be here”; HSBC Bank: Oil will be gone in 50 years). And obviously we have a unique amount of unrest across North Africa and the Middle East.

But if the world’s biggest commodity trader commodity trader says speculation is playing a role, one has to listen — especially since Goldman has been predicting higher oil prices for longer than most:

Goldman was one of the first banks to predict $100 oil last decade, in March 2005 when prices were closer to $50 a barrel.

On Tuesday, Goldman chief energy analyst David Greely said the recent run-up in prices, in which Brent rallied as much as 33 percent since the start of the year, looked overdone.

“While prices are back at levels of spring 2008, supply-demand fundamentals are significantly less tight,” Greely said in an April 12 note emailed to clients.

“We believe that the market will experience a substantial correction toward our $105 a barrel near-term target for Brent crude oil in coming months,” he stated.

Oil prices were down sharply, with Brent shedding more than $3 to settle below $121 a barrel. On Monday, prices hit a 2-1/2 year high of $127.02 before reversing….

Goldman analyst Greely said that while unrest in the Middle East and North Africa remains a risk to oil markets, with Libyan exports already largely cut off, the price had been pushed too high by the large number of speculative traders currently long crude oil.

“Both inventories and spare capacity are much higher now and net speculative positions are four times as high as in June 2008,” Greely said.

Exactly how much speculation is driving up oil prices remains contentious:

Goldman estimated in a research note on March 21 that every million barrels of oil held by speculators contributed to an 8 to 10 cent per barrel rise in the oil price.

As unrest spread in North Africa and the Middle East, investors accumulated the equivalent of almost 100 million barrels of oil between mid-February and late March on top of their existing positions, adding approximately $10 to the ‘risk premium’, Goldman said.

Using Goldman’s 8- to 10-cent estimates and data on speculators’ positions from the U.S. Commodity Futures Trading Commission, Reuters calculated that as of last Tuesday, the total speculative premium in U.S. crude oil was between $21.40 and $26.75 a barrel, or about a fifth of last Tuesday’s price. The UK’s Financial Services Authority (FSA) does not publish trader data on Brent.

Goldman Sachs disputed the Reuters calculation on speculative premium.
Source: climateprogress.org

So according to the fundamentals the price per barrel should be around $70 to $90 which would put street prices in the $3.25 unl $3.40 dsl range.

Current price per barrel:

Bobby Fleet Manager Wall diesel, economic recovery, fuel price increases

History

My first job was as a box boy for Hughes Markets. For those of you that remember Hughes Markets, they were very big on customer service, produce, free knife sharpening and the proper way to bag groceries. For example, most of us know that eggs, bread and tomatoes should not be on the bottom of the bag.  To bag groceries, we survey the groceries, cans and boxed items are used as the base to provide support for lighter items.  As you work from bottom to top, distribute the weight and maximize the space. Bagging groceries for Hughes Markets was such a big deal that we actually had annual top box boy contests in which store’s employees would compete against each other for the coveted title. The criteria was based on time, style, structure and look. Ultimately, the contest was designed for box boys to take pride in their work as this is usually the last chance for the company to make a good impression to the consumer.

Control – Is harder to manage but will typically produce better results. If the bags are properly filled you’ll carry less of them into your house, the grocery store uses less bags and it is easier on the environment.

How does this pertain to my fleet. . . less options provide for tighter control. For example, tell a driver to use 3 locations that are near your home base. This forces your driver plan his/her route effectively because they cannot get fuel outside the parameters that you set. Secondly, your drivers are happy because that is one less thing they have to think about. In addition, mileage, fuel consumption and shrink/slippage are reduced because your drivers are not flipping through a 500 page site locator or getting turned around.

Convenience – Notice the plastic bag above. Way easy for the box person to throw your items in it, you end up with a ton of bags, with 1 or 2 items in each, not to mention that the company needs to carry twice the inventory and it’s harder on the environment. While it seems great you pay for it. Think about it, do you have an iphone — It sure is convenient to get on the internet anytime you need it. But at $99+ /month your paying for that convenience. Same goes for managing your fleet. If you really don’t need 270,000 locations across the United States then you shouldn’t be paying for a fleet card that allows for that. Secondly, most of the drivers that I’ve talked with have told me that they plan their routes according to where they get fuel, so it would seem that all this convenience is unnecessary.

So Why Control and Convenience is like Paper vs. Plastic?

Reasoning
Simple, it’s easier. 9 out 10 times the box person won’t offer paper. It is easy for them to throw your groceries in a plastic bag versus asking what you would like. Same goes for fleet management, it’s easy to say I want 270,000 locations because I don’t know where my drivers are going to be vs. saying, “we travel here, here and here and you are going to fuel at these authorized locations”.

So the next time you go to the grocery store, get paper. And the next time your thinking about how to manage your fleet, start with control and open up convenience based on your fleets’ needs.

Good luck and in case you haven’t guessed I’m a fan of paper bags.

Z

Bobby Fleet Manager Wall

Thank you to all who provided feedback on the DEF Seminar.    John Neal is the winner of the Keurig coffee maker.  Based on the feedback that we received we will be planning future events. Thanks, Bobby Z

Feedback gives back!

Bobby Fleet Manager Wall

The DEF (Diesel Exhaust Fluid) seminar was a great success! An astounding 158 attendees from 100 different companies came to learn about Air1® over lunch. This brief 2 hour event covered important issues such as emission technology, EPA regulations, grant money available for new SCR trucks in California and the role of DEF. DeWitt also arranged for a guest speaker from Western Star, a heavy-duty truck manufacturer, to present. Topics included the benefits of SCR and a brief video of the technology.

Just wanted to say very informative. The pace of the presentation was very good and quick. More of these presentations should be addressed not only in fuel needs but also in Safety seminars and truck maintenance, vehicle equipment inspections..for some individuals or small companies not many can afford to be a member of Caltrux and then they lose out on important issues that affect our trucking industry. Anyway, great job and looking forward to future events that DeWitt may/will put on, says Dale Reinhart, C V R, a DeWitt Petroleum event attendee.

Please visit dewittpetroleum.com/DEF for more details..

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