With fuel prices at or near record highs, HDT Talks Trucking looks at how fleets can save money beyond better fuel mileage.
Glen Sokolis is CEO of Sokolis Group, a company he founded nearly 20 years ago to help fleets save money on fuel. On this episode of the HDT Talks Trucking video podcast, Editor in Chief Deborah Lockridge talks to him about why oil and fuel prices have spiked, and what fleets can do about it short- and long-term.
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Why are fuel prices so high and what can fleets do about it?
On this episode of HDT Talks Trucking, we’re talking to Glen Sokolis, an industry veteran who specializes in helping fleets manage their fuel costs. This episode is sponsored by Circle K. Get the most savings on every gallon when you fuel with the Circle K Fleet Card. Learn more at CircleKFleetCards.com.
Hi, I’m Deborah Lockridge, editor in chief of Heavy Duty Trucking. Today we’re talking to Glen Sokolis. He’s been in the industry for 30 years, and he runs the Sokolis Group, a fuel management company. That means that he helps fleets buy and manage their fuel better.
He’s written for HDT in the past, so I asked him to share some tips for us on how to save money on fuel beyond getting better miles per gallon. But before we get started. Don’t forget to follow us on social media and subscribe so you don’t miss an episode of HDT Talks Trucking.
Glen, welcome to HDT Talks Trucking. We’re glad to have you here. Talking about fuel, oil, high prices…we’ve seen crude oil prices up and down in recent weeks.
We’ve seen diesel prices up and down record highs. What are some of the reasons behind this? I know some people blame federal regulations for reducing domestic oil production, but isn’t it really more of a global issue?
Hi, Deborah. Thanks for having me.
Yes, the world markets do dictate the price of crude oil and diesel fuel but what we’re going through is something we’ve never been through. We’re coming off of a pandemic where a lot of people aren’t buying fuel. Obviously, because we’re all staying at our houses, trucks aren’t going as many places that they were, with the exception of maybe Amazon, FedEx and UPS because they’re delivering stuff to our houses.
But over the recent years, now that we’re all back driving again and trucks are delivering products to us and planes are flying, the demand is increased and that has caused obviously the prices to go up tremendously. And I think part of the problem is, when fuel prices were low, we basically came out from a government standpoint and said, listen, we don’t we don’t want to be around fossil fuels anymore. We want to get out of that business. We think electricity and alternative fuels are the way to go.
And we basically told the oil drillers and frackers that your business is not going to be around for a long time. And when we started to increase demand, oil drillers and frackers said, well, if we’re not going to be around long term, then I don’t think we want to we want to continue to drill and frack. So our production is down a little bit and our demands up and to help dictate the pricing where we’re at.
So how much has the war in Ukraine been affecting global fuel prices and the global oil prices and the price of fuel we end up paying here?
Well, I think the biggest problem that we’re having with the with the war in Ukraine, as far as pricing goes, is that it’s really just a matter of of uncertainty. We use very little fuel from Russia, very little. But Europe uses a lot. So if Europe then needs to use a lot more demand for Russian oil is large then and they’re not buying necessarily Russian oil or they’re afraid they’re not going to get Russian oil, because we’re really not sure what Putin’s going to do in this situation, that they might have to start using some of the resources that we get or where we get our fuel from like Saudi Arabia and some of the Arab nations, other Arab nations. And if that happens, then prices will jump. Right now, you sort of have a market that is hedging against that.
And I think that’s why we’re having the prices we’re at right now. So if I’m a fleet, this is certainly not the first time oil and fuel prices have gone up and down. They’ve been, not quite so volatile the last couple of years. But you and I’ve seen it many times in our years in the industry.
How can a fleet be prepared for these kinds of fluctuations
Well, yeah, we haven’t seen anything like this. This is this is incredible. My 30 years in the fuel industry, I haven’t seen anything that resembles this at all. , when I first got in the business years ago if the price move, more than a quarter cent in a day, we thought it was a big deal. We’re seeing fluctuations of 25, 30, 50 even $0.75 in the day, which is astronomical from a standpoint of what we could do. I think the best thing is every company is a little bit different.
So I think some companies, if you’re a small company, you can go and obviously shop around, look down the block and see who has the lowest fuel prices. If you’re a larger company, talk to some of your your fuel suppliers and see if you can consolidate some of your volume and negotiate some deals with them to send them to your… to the truck stops or if you’re buying bulk or mobile fuel, go back to them and determine are you getting the best pricing that is available to you based upon your size and how frequently you get your deliveries and and how well you pay.
So, you sort of covered this a little bit, but any other suggestions for , what a fleet can do immediately to save money? On their fuel costs?
Well, I think, if from a standpoint of, even a consumer and a fleet, if you can reduce the amount of miles you’re driving in a day, that’s automatic savings, right? Because the less miles you drive, the less the less fuel you’re going to burn now. Obviously, there’s a lot of companies that can’t do that. They’re already maximizing/minimizing the miles driven.
So, I think from a standpoint of what they could do today, again, I think that maybe the the best thing to do is to, again, go out and and look at the best places where they can buy fuel, the lowest places in your area, truck stops, potentially an app, maybe go online and look at a GasBuddy or Fuel Book. Talk to your vendors. A lot… another area where a lot of people don’t really look is audit your bills.
Fuel companies are having issues with labor just like everybody else. So your local Starbucks has issues with labor. So it’s the fuel company and they’re having people in different positions sending out invoicing and the fuel prices going up and down every day very rapidly.
So people aren’t really you know, there might not be doing the same system they’re doing every day. And mistakes are made. A lot of mistakes right now are made. So I tell everybody to make sure you audit your fuel invoices, to make sure that you’re getting what you thought you were going to you’re going to get in paying for what you thought you were going to be paying.
Good advice at any time.
But yeah, especially now. And I remember the last time fuel prices got high, obviously, like you said, not this high, but I remember hearing reports about fuel theft.
Are you hearing any customers or any talk about that being a problem now?
Surprisingly, I’m not hearing a lot about fuel theft right now. And you’re right. In past times when the market has gone crazy, that fuel theft usually dips into it, jumps into the scene pretty quickly. I have not heard that right now. And and that could be for a couple of different reasons. I think that, at the pump fuel cards have gotten a little bit more secure over the years with pin numbers and odometer readings.
I also believe that anti-theft devices on vehicles have gotten to be a little bit better. And maybe we just haven’t heard the stories yet. Maybe they’re still out there to come because really we even know the prices have gone up since the beginning of the year, a lot. That they’ve really gone on rapidly over the last couple of weeks. So maybe the stories are still out there to come.
That may be, that may be.
What about longer term strategies and fuels always a top cost for fleets. So managing your fuel costs is going to help you help your bottom line no matter what the retail price. What are some of the top ways that you suggest long-term for fleets to save on their fuel?
Well, I think the some of the best ways for a company to save on their fuel is to really look at their whole fuel program. Take a step back and look at it from top to bottom. If you’re a small operator, maybe your fuel program is a fuel card.
So, look at the fuel card that you’re using and then determine, can I have all my drivers go to one location to fuel and then, go to that location and potentially negotiate a deal with that location. Because, it’s like anything else. The more you buy, the better. The better break you’re going to get on something. If you’re a larger company, you’re buying fuel at several different mechanisms. You might be buying it at a truck stop or mobile fueling or bulk fuel or even leasing fuel at some of your larger, larger lease companies.
Look at your program, not when you’re in the heat of the day like we are right now, but look at it when things are a little bit calmer and decide that, hey, what is the best what’s best for my company? Is it best to have a mobile fuel program where a company comes out and fuels my vehicles at night?
Because I have high labor costs for my drivers? Or are my drivers driving past a truck stop every day and I can consolidate the utilization there to make sure that I can get the best rate with that particular truck stop. But it’s really to take an all encompassing look at how you’re buying fuel as opposed to just kind of piecemeal it.
You know, whenever it happens, I find most companies sort of set it and forget it and never look back. It’s a it’s a constantly… it’s a living, breathing thing. A good fuel program. So some fleets might end up being inspired to once things calm down a little, to take some of those longer term looks at their fuel program.
Well, Glen, that’s about all the time we’ve got for this episode of HDT Talks Trucking. I appreciate your insights today, and thanks for being on. Thank you.