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Feeling fuelish: Dont abandon fuel economy efforts just because diesels down convenience store (actual gas stations don’t really exist anymore) up the street from my house is selling regular unleaded gasoline for $1.87 a gallon. This is the lowest price for gas I’ve personally encountered yet. And it’s a good feeling to actually fill my pickup all the way and drive around with the gas needle resting on “Full” for a change.

In its January edition of the Short Term Energy Outlook, the DOE’s Energy Information Administration forecasts the price of diesel to average $2.85 this year, …

If this sudden fuel price drop teaches us anything, it is to underscore the extreme volatility and unpredictable nature of global energy markets today. Crude oil is a commodity traded on global markets much the same way pork bellies or cotton are. So, naturally, its price fluctuates according to supply and demand, just as other commodities do. However, it is always important to remember that the pool of people bidding on that barrel of crude oil has increased exponentially over the past 20 years. I’m looking at you, China, India, Russia and Africa. The more interested parties bidding for a commodity, the higher the price goes. That’s Economics 101.

But – and here’s the catch – oil is also a strategic resource that is absolutely vital for a country’s defense and economic well being. Like it or not, our model global economy is powered by oil. Which makes manipulation of supply and pricing a powerful tool when a nation wants to put economic pressure on a political rival.

All of this leads me to suggest that all evidence points to more wild swings in fuel prices with an inexorable overall trend toward consistently higher prices at the pump. Fleets (and consumers) who stay the current course on enhancing fuel economy in their operations and daily life will be in much better shape to weather the storm once gasoline and diesel start trending upward again.

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