The entire supply chain is under great financial stress as the spot price of WTI crude oil rose steadily to over US$110 per barrel, on March 13th of 2008 — a record-setting price.

While the price for WTI crude oil is expected to average near $100 per barrel through the rest of this year, transport companies and everybody else getting their supply through their services are bracing for the effects of higher fuel prices during the summer season, defined as the period from April 1st to September 30th.

Pricewise, let’s start with the regular grade gasoline retail prices, which averaged $2.93 per gallon last summer (of 2007) and are projected to average $3.54 per gallon during the current driving season.

The trucking business is going to be hit even harder as diesel fuel prices, which averaged $2.85 per gallon last summer, are projected to average $3.73 this summer.

In fact, the monthly average gasoline price at the pump is projected to peak at just over $3.60 per gallon in June while the monthly average diesel price is expected to peak at just over $3.90 per gallon in April.

These rather scary retail price projections reflect higher prices for the refiners’ average acquisition cost of crude oil, projected to average close to $97 per barrel, up from about $67 per barrel last summer which account for a hefty $30 price hike, per barrel. Furthermore, strong world distillate demand growth, especially in Europe and Asia, will do nothing to help the situation domestically, in America.

It is important to note, however, that even if the US national average monthly gasoline price comes to peak around $3.60 per gallon this summer, it’s entirely possible that prices, at some point, will cross the $4 per gallon threshold, severely hurting the transport industry and those who depend on it.

Countless consumers may be forced to reconsider driving their cars at all and the same kind of dilemma may happen for transport operators of all sizes as well as petroleum-based product manufacturers.

Transportation and logistics companies, especially in America, need to plan (and provision lots of “emergency money”) right now for this summer’s potential fuel price explosion.

Tags: gas, fuel, wti crude oil, oil, diesel, petroleum, pump, america, usa, transport, logistics, summer

The U.S. Deputy Transportation Chief says an “energy diet” is much needed to curb US’ growing oil addiction.

Transportation industries will have to go on an “energy diet” to help end America’s addiction to oil, U.S. Transportation Deputy Secretary Maria Cino said today after a demonstration of how Rhode Island’s switch from light bulbs to LEDs in traffic signals across the state is saving millions of watts of electricity and hundreds of thousands of taxpayer dollars.

The nation’s deputy transportation chief said there are several innovative technologies and practices under way to help achieve the energy goals spelled out by President Bush during last month’s “State of the Union” speech.

“America is the most mobile society on earth, and that’s not going to change,” Cino said. “What is going to change,” she added, “is that our cars, trains, airplanes and ships must use significantly less oil, if they use oil at all, to move people and products in the future.”

Rhode Island’s conversion of 87 percent of state maintained traffic signals from conventional bulbs to LED lights has reduced energy consumption by nearly 90 percent and saves taxpayers $450,000 annually in electricity costs, Cino said.

She added the initiative was a great example of “how even some of the simplest changes can save energy. They are showing the Nation just how easy it can be to tighten their energy belts.”

She said the Bush Administration is doing its part to encourage new energy technology, including the investment of nearly $10 billion since 2001 to develop cleaner, cheaper and more reliable alternative energy sources, including alternatives to gasoline and diesel fuels, better batteries for hybrid cars, and pollution-free hydrogen fuel cells.

“Quitting oil does not mean that America quits moving,” Cino said.

Cino and her boss, Secretary Norman Y. Mineta, are on the road this week to promote energy saving initiatives occurring in the nation’s transportation industries. This morning, Cino toured a plant in Malta, NY where scientists are making lightweight composite metals for more fuel-efficient automobile parts.

Mineta toured a plant in suburban Detroit yesterday that makes power-saving vehicle systems that improve automobile fuel efficiency and rode with Union Pacific locomotive engineers in Omaha, NE to learn how they are saving millions of gallons of diesel fuel just by learning new techniques for driving their trains.

This proves the US is taking emerging petroleum alternatives seriously and as such, there might be more announcements coming along soon.

Tags: energy diet, diesel fuel, driving trains, locomotive engineers, union pacific, fuel efficiency, oil addiction, america