Five Steps to Reducing Your Pump Price Pain

speedometer showing low speed to reduce consumption
These sustainable action items can help reduce your company’s fuel costs

Here’s the bad news. Pump price pain will only increase for your small business. The good news is you can take five sustainable action items you can take to cut your gasoline or diesel monthly bill that also reduces emissions.

Why Pump Prices are High

Lower pump prices were the promise of hydraulic fracturing’s unleashing of new oil supplies. That obviously has not happened because oil is a global commodity where global demand and supply determine what you pay at the pump. The price at the pump is high and probably going higher because global demand for oil is growing faster than incremental increases in supply. That will only change if countries like China and India realize they cannot afford the cost and emissions of a billion cars and trucks. Right now the only thing that can reduce pump prices is another global recession that significantly reduces oil demand growth.

Why Pump Prices are Going Higher

Hydraulic fracturing did mitigate the rate of pump price increases over the last few years because this new oil supply did not have an adequate transportation path for sale into the global market. That ended this month. U.S. oil is now reaching the world market. That is a major reason why the price of oil is more than $100 per barrel and pump prices are going higher.

The wall of big numbers is the other reason why your pump price pain is rising again. Oil is a risky business. It is even riskier now that the world is producing record amounts of oil. Refineries are very complex and they will have significant failures. When that happens your pump price increases. Pipelines leak, railroads have accidents and tankers go aground. When a major event occurs, your pump price goes up. The reality is that a significant supply of the world’s oil is sourced from politically unstable regions. The national news is filled with stories that link political unrest and threats to the world’s oil supply. The rate of risk within the global oil supply is increasing and this increase is driving the price of oil and your pump pain higher.

Five Steps to Reducing Pump Price Pain

You are not powerless. You can reduce your pump pain. The first step is to realize the best time to begin this process is right now. Pump prices could go down but not for long or for the long term. So decide to act, now. The following are five steps every business should consider for reducing their pump pain.

1. Measure. I am surprised at how many businesses do not keep detailed records on their fuel costs by work associate and vehicle. Valuable trends are surfaced from this type of analysis because 10 to 50 percent of fuel waste is tied to a human behavior. Some drivers use more fuel per mile. Many truck routes are not shaped to minimize fuel consumption. Sharing this data with work associates enables change. Awareness is half the battle to winning relief at the pump.

 

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About the author

Bill Roth

Bill Roth is a disruptive tech business pioneer that led teams in launching the first hydrogen fueled Prius and in developing one of the first non-thermal utility scale solar power plants. He has applied his behavioral economics expertise to develop disruptive pricing and consumer engagement digital platforms. Visit his LinkedIn profile to learn more on how Bill is coaching clients on disruptive technology strategies that win customers and competitive advantage. 
 

 

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