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 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.
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 insight into the effects of a higher nationwide fuel price.
“Fleets are generally used to prices fluctuating, 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 is 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. 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.
Source FleetCards USA TrendWatch