12.04.2023 Energy
Dec 08, 2023
12-4-23
One of the most frequently asked questions we receive is “when is a good time to contract?” This question comes up almost daily for the Energy staff. Almost any day can be a good day to contract energy products, when positioning for energy needs the crystal ball can typically be very cloudy! As a rule of thumb contracting should be done when it fits the customer need at a price that seems fair considering current energy intel. Every year has its own unique characteristics that can change when we see price high and lows. One constant in the energy marketplace is the fact that crude oil is no different than other commodities in that it is traded by traders each and every day all day long, as these traders buy in or sell out, the price of crude oil is obviously affected which flows through changing the price of gas and diesel. In some research done recently I’ve learned that since 1996 December has been the best month to contract diesel followed very closely by January. Ironically October is tied with January when analyzing which months of each year since 1996 have had the lowest price of diesel. Safe to say not many of us would have guessed October as that is usually our heaviest fuel demand month throughout the year. In recent years data has become immediately available, what this typically causes is purchasing headlines vs purchasing based off rational or reason, what that has done is make the job of recommending when to contract diesel in particular, extremely exciting, challenging, and nerve racking! At CRC it is our goal to help you the patron limit your risk; we may not sell you fuel at the lowest price point every time, but we also should not sell you fuel at the high price point of the year! At any time, the gals answering the CRC phones, Scott Johnson, Jesse Fischer, and myself can help you navigate current market conditions to determine when the contract price of diesel fuel fits your needs and wants. Per current analysts’ perspective it seems reasonable that between now and January 1st, 2024 patrons should be at least considering current contract diesel fuel pricing for 2024 needs.
Thank you,
Bill Pelzel
Energy Manager CRC
One of the most frequently asked questions we receive is “when is a good time to contract?” This question comes up almost daily for the Energy staff. Almost any day can be a good day to contract energy products, when positioning for energy needs the crystal ball can typically be very cloudy! As a rule of thumb contracting should be done when it fits the customer need at a price that seems fair considering current energy intel. Every year has its own unique characteristics that can change when we see price high and lows. One constant in the energy marketplace is the fact that crude oil is no different than other commodities in that it is traded by traders each and every day all day long, as these traders buy in or sell out, the price of crude oil is obviously affected which flows through changing the price of gas and diesel. In some research done recently I’ve learned that since 1996 December has been the best month to contract diesel followed very closely by January. Ironically October is tied with January when analyzing which months of each year since 1996 have had the lowest price of diesel. Safe to say not many of us would have guessed October as that is usually our heaviest fuel demand month throughout the year. In recent years data has become immediately available, what this typically causes is purchasing headlines vs purchasing based off rational or reason, what that has done is make the job of recommending when to contract diesel in particular, extremely exciting, challenging, and nerve racking! At CRC it is our goal to help you the patron limit your risk; we may not sell you fuel at the lowest price point every time, but we also should not sell you fuel at the high price point of the year! At any time, the gals answering the CRC phones, Scott Johnson, Jesse Fischer, and myself can help you navigate current market conditions to determine when the contract price of diesel fuel fits your needs and wants. Per current analysts’ perspective it seems reasonable that between now and January 1st, 2024 patrons should be at least considering current contract diesel fuel pricing for 2024 needs.
Thank you,
Bill Pelzel
Energy Manager CRC
Filed Under: Contract