FuelQuest Survey Shows Increased Focus on Fuel Price Volatility

HOUSTON -- Day-to-day fuel price swings of 5 cents or more occur 25 percent of the time, compared to only 1.5 percent of the time prior to 2004, FuelQuest Inc.'s inaugural Eye on Energy Survey revealed. This volatility and its potential to negatively impact margins are permanent fixtures for retailers, the on-demand services and software provider concluded during its recent GRAIL fuel industry and user conference.

The Houston conference brought together more than 140 market leaders from retail, distribution, supply and transportation companies. The survey, presented at the event, concluded that fuel retailers want real-time margin visibility, with 16 percent stating better margin management is their top strategic business priority for 2013.

Governmental policies could get in the way of margins, however. More than 40 percent of participants cited the Patient Protection and Affordable Care Act as a policy expected to eat away margins, with Environmental Protection Agency Tier 3 standards and excise taxes also expected to affect profits.

The study also found that 20 percent of respondents are currently examining compressed natural gas and liquefied natural gas as potential portfolio fuels, with 18 percent planning to adopt such fuels within the next five years.

In addition, electric vehicle charging stations are gaining traction. Sixty percent of survey participants said they are considering adding electric vehicle chargers to their locations and 17 percent are currently adopting them, while 23 percent said they do not know if they will install chargers or not.

"At our GRAIL conference, industry leaders engaged in spirited discussions concerning trends and issues that affect businesses that buy, sell or transport bulk fuels," said Matt Tormollen, FuelQuest's president and CEO. "The Eye on Energy Survey underscored the need for strategic planning and technology automation initiatives that tackle emerging opportunities, as well as addressing tactical fuel and tax management challenges today."