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TrendWatch: Gas Prices May Pass $4/gal Nationwide

by FleetCards USA | May 17, 2011

The dreaded milestone that consumers have been hoping to avoid going into this summer may be coming faster than anyone thought; gas prices could soar to over $4/gallon nationwide within the coming week, according to a Yahoo! Finance interview with Tom Kloza, chief analyst at the Oil Price Information Service.

"There's enough momentum to take us up there," said Kloza, who also noted that this weekend's 3.4-cent surge was likely a delayed reaction to deadly storms across the South last week that temporarily knocked out power at some oil refineries along the Gulf Coast.

Refineries located around the Great Lakes have also been shut down recently for scheduled maintenance, which has led to higher gas prices across the Midwest. Combined with the general upward trend in prices with the price of oil stocks and global energy demand.

Prices have risen 88 cents since the beginning of the year, with no end in sight as the summer looms. Though prices are not currently expected to rise consistently throughout the summer, Kloza says that price spikes, most notably around the July 4th weekend, will drive prices up sharply from time to time.

Paul Citarella of FleetCards USA TrendWatch provided some insight into the effects of a higher nationwide fuel price.

“Fleets are generally used to prices going up and down, but crossing a threshold like the four dollar mark makes a lot of businesses stand up and take notice,” said Citarella. “It makes people think harder about their fuel budgets when suddenly the price looks like a dollar more than they were paying just a few weeks ago.”

Fleet owners have already felt the sting of higher prices nationwide. A recent survey by CNN of average prices by state showed that residents of California, Indiana, Michigan, New York, Alabama, West Virginia, Connecticut and Washington were already paying over $4/gal for gas, with Hawaiians paying the most at $4.59/gal. In Mississippi, residents are paying an average of 14.23% of their yearly income on fuel.

“The fortunate thing for businesses experiencing financial anxiety from these high prices is that the economic blow can be mitigated by smart, proactive fuel management,” said Citarella.

Businesses bracing for the summer driving season should take time to examine their fuel spending and take care of any waste or inconsistency now before mistakes become even costlier. With a little bit of preparation and smart spending, the coming year can still be one of growth for fleets.

 

ABOUT FLEETCARDS USA TRENDWATCH FleetCards USA is an industry leader offering valuable fleet card advice, industry news, and information from numerous fleet card programs to companies of all sizes across the USA, from small entrepreneurial organizations to large public corporations. The FleetCards USA TrendWatch council was formed to keep consumers informed and educated about changes in the fueling industry that affect business fleets every day. FleetCards USA acts as a trusted advisor to customers in all sectors, from retail to transportation and government, thanks to a team of experienced industry veterans and partnerships with the biggest names in fleet fueling. Customers can keep up with TrendWatch on a daily basis on Twitter @FleetCardsUSA.