The cost of crude oil has climbed to the levels last seen in the wake of Hurricane Katrina – more than $70 a barrel.
Reasons for the hike include concerns about possible military action against Iran and rebel attacks in Nigeria that have shut down a quarter of the country’s oil production. With no sign of the situation improving, industry experts are warning that fuel prices could top £1 a litre by the summer.
Mike Waters, head of market analysis for fleet and fuel management firm Arval, said: ‘Each penny per litre average increase potentially adds £1,666 to £2,000 per annum to companies’ fuel bills, based on a 100-car fleet running a 60/40% diesel petrol split.’
He said fleet managers should focus their attention on things they can influence and that current fuel price rises are clearly down to movements in global oil markets.
Waters added: ‘You can influence how you buy fuel and how your drivers use it. By implementing a formal fuel policy all drivers can be made aware of their responsibilities to buy and use fuel wisely.’
Arval is urging business drivers to change their fuel purchasing habits, moving from a ‘distress purchase’ when the fuel gauge is on red, to a ‘planned purchase’ made at price competitive forecourts.
Waters said: ‘Fleets need to ensure that drivers closely monitor prices and adopt fuel management techniques.
‘Implementing target pricing initiatives, better planning of fuel purchases to avoid motorways and, if all else fails, part-fill tanks at expensive forecourts with enough fuel to get to a cost-effective location.
‘At times of high fuel prices, it has never been more important to get a better understanding of fuel consumption. Fuel cards afford companies the ability to not only monitor organisation-wide fuel costs, but also pinpoint individual driver behaviour to ensure fleet and fuel policies are being adopted at the coal face.’
Keeping costs down as fuel goes up
To keep your head above water as fuel costs rise, there are a number of tips to give your drivers that should keep your bill to a minimum.
Firstly, encourage them to drive as smoothly as possible, minimising braking and gear changing and using as little pressure on the accelerator as possible.
Exceeding speed limits requires more power and more fuel, with minimal time gain.
Journey planning can save time and money by picking a route free from congestion, but if the worst happens and drivers do get stuck in a jam, switching off the engine will save fuel.
Encourage your drivers to carry out basic checks – incorrect tyre pressures can result in a 3% increase in fuel consumption, according to the RAC.