More Fleets Report Positive 1Q Financials - Source Trucking Info

More Fleets Report Positive 1Q Financials

(UPDATED) Most carriers are reporting positive first quarter financial results, and some are setting records with their numbers. P.A.M, UPS, Old Dominion, Ryder, Celadon, Knight, Landstar and Universal Truckload all reported increased revenues for the first quarter of 2012. Covenant Transport reported some decreases, but its numbers were an improvement over 1Q 2011. Arkansas Best Corp. reported losses for the quarter compared to the first quarter of 2011.

Arkansas Best Corp.

Arkansas Best Corp., Fort Smith, Ark., reported a first quarter 2012 net loss of $18.2 million, or 71 cents per share, compared to a net loss of $12.8 million, or 51 cents per share in the first quarter of 2011. 

The company says its less-than-stellar first quarter results were impacted by the following:

- Low corporate tax benefit rate - (18 cents per share)
- High ABF workers' compensation costs - (13 cents per share)
- Investments in sales, customer service and IT for all subsidiaries- (12 cents per share)

P.A.M. Transportation Services

P.A.M., Springdale, Ark., reported net income of $674,193 or diluted and basic earnings per share of 8 cents for the quarter. These results compare to a net loss of $1.98 million or diluted and basic loss per share of 21 cents for 1Q 2011. Operating revenues were $96.16 million for the first quarter of 2012, a 13.1% increase compared to $85.03 million in 2011.

On a per-mile basis, operating expenses in trucking operations, net of fuel surcharge, were down 4.8% for the first quarter 2012 compared to the first quarter 2011. 

The company increased driving employees by 3.5% 1Q 2011 to 1Q 2012 and has more than tripled the number of independent contractors during the same period.

UPS

For the quarter, UPS, headquartered in Atlanta, reported diluted earnings per share of $1, a 10% improvement over the prior-year period. Consolidated revenue increased 4.4% to $13.1 billion, and operating profit for the U.S. Domestic and Supply Chain and Freight segments increased 13% and 19%, respectively.

Net income rose 6% to $970 million, or $1 per share, from $915 million, or 91 cents a share, a year ago. Revenue rose 4.4% to $13.14 billion, the company reported.

International package operating profit slipped to $408 million from $453 million, but revenue rose 2.3% to $2.97 billion.

Old Dominion Freight Line

Old Dominion, Thomasville, N.C., saw revenue increase by 17.6% to $497.1 million from $422.7 million for the first quarter of 2011. Net income was $31.1 million for the first quarter of 2012, which was an increase of 44.1% from $21.6 million for the first quarter of 2011. Earnings per diluted share increased 42.1% to 54 cents from 38 cents for the first quarter last year, and the company's operating ratio improved to 89.1% from 91%.

First quarter revenue reflected a 10.7% increase in tonnage and a 5.5% increase in revenue per hundredweight compared to 1Q 2011. The increase in tonnage is the result of a 9.5% increase in shipments and a 1% increase in weight per shipment, the company says.

Ryder System

Ryder's earnings per diluted share from continuing operations for 1Q 2012 were 68 cents, compared with 50 cents in the year-earlier period.

The company, headquartered in Miami, had a total revenue for the first quarter of 2012 of $1.54 billion, up 8% from $1.43 billion in the same period last year. Operating revenue (revenue excluding Fleet Management Solutions fuel and all subcontracted transportation) was $1.23 billion, up 9% compared with $1.13 billion in the year-earlier period. 

Ryder's Fleet Management Solutions and Supply Chain Solutions business segments saw total revenue growth of 9% and 7%, respectively. 

Celadon Trucking Services

Celadon, Indianapolis, saw revenue for the quarter increase 10.5% to $153.2 million in 2012 from $138.7 million in the 2011 quarter. Freight revenue, excluding fuel surcharges, increased 7.8% to $120.9 million in the 2012 quarter from $112.2 million in the 2011 quarter. Net income increased to $5.7 million in the 2012 quarter from $2.3 million for the same quarter last year. Earnings per diluted share increased to 25 cents in the 2012 quarter from 10 cents in 1Q 2011.

For the nine months ended March 31, 2012, revenue increased 5.9% to $441.2 million in 2012 from $416.8 million for the same period last year. Freight revenue increased 0.8% to $350.6 million in 2012 from $347.9 million for the same period last year. Net income increased to $16.6 million in 2012 from $9.8 million for the same period in 2011. Earnings per diluted share increased to 73 cents in 2012 from 43 cents for the same period last year.

Knight Transportation

For the quarter, Knight's total revenue increased 17.7% to $219.5 million from $186.5 million in the first quarter in 2011. Revenue before fuel surcharge increased 16.7% to $175.6 million from $150.5 million in the first quarter of 2011. 

The company, based in Phoenix, had a net income of $10.5 million, or 13 cents per diluted share, from $9.9 million, or 12 cents per diluted share, in the first quarter of 2011. 

In the first quarter 2012, the company's revenue per tractor (excluding fuel surcharge) improved 10.3% as a result of a 7.3% improvement in miles per tractor and a 2.8% improvement in revenue per total mile (excluding fuel surcharge) with a 2.6% longer length of haul. 

Covenant Transport

Covenant, based in Chattanooga, Tenn., reported freight revenue of $121.9 million, a decrease of 2% compared with the first quarter of 2011. The company had an operating income of $2.4 million and an operating ratio of 98.1%, compared with operating income of $0.3 million and an operating ratio of 99.8% in the first quarter of 2011

In 1Q 2102, Covenant experienced a net loss of $0.6 million, or.4 cents per share, compared with a net loss of $2.5 million, or 17 cents per share in 1Q 2011.

Average freight revenue per tractor per week increased to $3,044 during the 2012 quarter from $2,980 in 2011. Average freight revenue per total mile increased by 7.7 cents per mile (or 5.8%) compared to the 2011 quarter, but average miles per unit decreased by 2.4%.

Landstar System

Landstar, Jacksonville, Fla., reported the best first quarter financials in the history of the company. 

The company reported 2012 record first quarter diluted earnings per share of 57 cents from net income of $26.8 million, compared to net income of $20.6 million, or 43 cents per diluted share, for the 2011 first quarter.

Operating margin, representing operating income divided by gross profit was 40.8% in the 2012 first quarter compared to 35.4% in the 2011 first quarter. Revenue for the 2012 first quarter was a first quarter record of $649 million compared to $572 million in the 2011 first quarter. 

Universal Truckload Services

Michigan-based Universal Truckload's first quarter operating revenues increased 11.6% to $175.8 million from $157.6 million in 2011, and operating ratio improved 70 basis points to 96.9% from 97.6% for 1Q 2011. Included in operating revenues are fuel surcharges of $22.1 million and $17.9 million for 1Q 2012 and 1Q 2011, respectively. 

First quarter income from operations increased by 40.4%, or $1.5 million, to $5.4 million for the quarter from $3.8 million in 2011, and net income increased by $0.7 million, to $3.6 million (23 cents per basic and diluted share) from $2.9 million (18 cents per basic and diluted share) for the first quarter of, 2011. 





Please feel free to comment to any of the posts on this blog. The intent is to start discussions on the subject content. If you have articles for post or comments about the blog in general please contact: Thank you Preferred Logistics----------- www.preferredlogistics.biz

FMCSA Cracks Down on Reincarnated Carriers - Source Trucking Info

FMCSA Cracks Down on Reincarnated Carriers
By TruckingInfo Staff

A new rule from the Federal Motor Carrier Safety Administration makes it tougher for carriers that have been sanctioned to reincarnate themselves under a new identity.

The agency last week posted a final rule that changes its procedures in several areas affecting truck lines, intermodal equipment providers, brokers, freight forwards and hazmat proceedings.

The key change: paying a full civil penalty in an enforcement proceeding does not give the entity the ability to unilaterally avoid an admission of liability. Such a payment constitutes admission of all of the facts in a Notice of Claim, unless the entity and the agency agree otherwise.

The agency also will review out-of-service orders before they go into effect on reincarnated operations that have a history of breaking the rules. And it will consolidate the records of reincarnated entities with their predecessors' records.

Carrier interests generally support the move to clarify agency policy on admission of liability, albeit with some reservations, the agency said. The agency's decision turned on its contention that businesses with a lot of financial resources could afford to repeatedly violate the rules by simply paying the fine.


Please feel free to comment to any of the posts on this blog. The intent is to start discussions on the subject content. If you have articles for post or comments about the blog in general please contact: Thank you Preferred Logistics----------- www.preferredlogistics.biz

US consumer spending slowed in March, income rose - Source AP

US consumer spending slowed in March, income rose

FILE - In this Nov. 25, 2011 file photo, shoppers... ((AP Photo/Daily News, Joe Imel, File))

WASHINGTON—Americans increased their spending more slowly in March, a sign that scant pay increases may be causing consumers to become more cautious.

Their spending rose 0.3 percent last month, just one-third the increase in February.

Slow wage growth and softer consumer spending gains are the latest evidence that the economy might be weakening after a strong first two months.

Economists say a warm winter made the economy look better because it caused some activity that normally occurs in spring—from hiring to home sales—to occur in January and February. That made March's gain smaller.

A more troubling factor in the long run is that Americans are receiving little or no pay raises. "Real" income—income adjusted for inflation—has been growing too slowly to sustain healthy increases in consumer spending, many economists say.

After-tax income rose just 0.6 percent in the first three months of 2012 compared with a year earlier. That was the smallest gain in two years.

"Real incomes will need to grow at a faster rate to prevent consumption growth from slowing," said Paul Dales, senior U.S. economist at Capital Economics.

Before the Great Recession, a healthy gain in consumer spending was between 5 percent and 6 percent a year. March's increase was roughly half that pace.

And if income, adjusted for inflation, continued to grow at March's rate, the annual growth would be roughly 2.5 percent. While that's better than a decline, economists consider it a weak figure.

The U.S. economy depends on consumer spending for roughly 70 percent of activity. Many people have been increasing their spending by saving less.

For the full January-March quarter, consumer spending rose at an annual rate of 2.9 percent, the fastest pace in more than a year. The increase was a bright spot in an otherwise sluggish quarter. Dales noted that spending in January and February drove the quarterly increase.

Without better pay, that trend isn't sustainable. The savings rate edged up to 3.8 percent in March, after dropping to a 30-month low of 3.7 percent of after-tax income in February.

And income, adjusted for inflation, inched up just 0.2 percent after declining for two straight months.

In the January-March quarter, the economy grew at an annual rate of 2.2 percent. That was down from a 3 percent annual growth rate in the October-December period. The weakness mainly reflected slower gains in government spending and weaker business investment.

An inflation gauge tied to consumer spending rose a modest 0.2 percent in March. Over the past 12 months, the index has risen just above the Federal Reserve's 2 percent inflation target

A healthy job market could reinvigorate consumers because more jobs mean more money to s(pend. But the economy created just 120,000 jobs in March—half the pace of the previous three months.

Economists predict that employers will have added 163,000 jobs this month, below the pace from December through February.

One positive change since the winter: Gas prices appear to have peaked. That would give consumers more to spend elsewhere.

The nationwide average for a gallon of regular gasoline stood at $3.83 on Friday, down eight cents from a month ago, according to AAA's fuel gauge report.



Please feel free to comment to any of the posts on this blog. The intent is to start discussions on the subject content. If you have articles for post or comments about the blog in general please contact: Thank you Preferred Logistics----------- www.preferredlogistics.biz

Kuwaiti MP questions oil deal with China - Source Zawya News

Kuwaiti MP questions oil deal with China

---

KUWAIT CITY, Apr 30, 2012 (AFP) - A Kuwaiti opposition MP on Monday questioned what he called a "suspicious" deal to supply China's Sinopec with 300,000 barrels per day of oil for 10 years.

The deal involves "several legal, administrative and technical violations," charged MP Mubarak al-Waalan.

In a series of questions to Oil Minister Hani Hussein, the lawmaker claimed the deal, signed in November, was concluded without obtaining the mandatory prior approvals of the government legal and accounting authorities.

The deal was not also authorised by the board of directors of Kuwait Petroleum Corp. (KPC), the emirate's national oil conglomerate, as required by the law and also involved unjustified financial facilities, the MP alleged.

Waalan, a member of the opposition which has a majority in parliament, demanded a copy of the contract and asked the minister if it involves any loss to Kuwait's public funds.

He also asked Hussein, who was appointed in February, to explain the financial facilities and guarantees provided to the state-owned Chinese firm as part of the agreement.

KPC and Sinopec are involved in a separate $9-billion joint venture to build a refinery and a petrochemicals complex in China's southern Guangdong province.

France's energy giant Total has taken 40 percent of KPC's share or 20 percent of the venture.

oh/lyn/srm

Please feel free to comment to any of the posts on this blog. The intent is to start discussions on the subject content. If you have articles for post or comments about the blog in general please contact: Thank you Preferred Logistics----------- www.preferredlogistics.biz

Oil prices hit by economic gloom

Oil prices hit by economic gloom-Source Zawya News

---

LONDON, Apr 30, 2012 (AFP) - World oil prices fell Monday, making a downbeat start to the week as investors fretted over economic gloom in both the eurozone and the United States, analysts said.

New York's main contract, West Texas Intermediate (WTI) crude for delivery in June, dropped 59 cents to $104.34 a barrel.

Brent North Sea crude for June shed 78 cents to $119.05 in London midday trade.

Official data Monday showed Spain had tipped back into recession -- another dose of grim news for a cash-strapped economy that has been hobbled by rising sovereign debt, soaring unemployment and deeply troubled banks.

"Crude oil prices started the week in negative territory, following fairly disappointing economic data from Spain that confirmed that the Spanish economy is sliding into recession," said Sucden broker analyst Myrto Sokou.

"The data weighed on crude oil prices, confirming a slowdown in oil demand, especially from the European countries due to the lack of economic development."

Spanish gross domestic product shrank by 0.3 percent in the first quarter of 2012, equalling the slump in the final quarter of 2011, according to preliminary data from the National Statistics Institute.

The return to recession, blamed on weak domestic demand only partially compensated by exports, comes barely two years after Spain emerged from the last downturn at the start of 2010.

Investors fear that Spain could follow a Greek-style downward debt spiral and trigger chaos in the market, in turn ravaging global energy demand.

Oil prices fell Monday also after data showed that US economic growth slowed sharply in the first quarter of 2012, rekindling concerns that the nascent recovery in the world's top oil consumer was losing steam.

US gross domestic product grew at an annual rate of 2.2 percent in the first three months of 2012, slowing from 3.0 percent in the fourth quarter of 2011.

The dip in growth was largely attributed to a slump in government spending.

burs-rfj/bcp/bmm 

Please feel free to comment to any of the posts on this blog. The intent is to start discussions on the subject content. If you have articles for post or comments about the blog in general please contact: Thank you Preferred Logistics----------- www.preferredlogistics.biz

Canadian Freight Index Rises for 12th Time·

·         Canadian Freight Index Rises for 12th Time·         

·         The cost of ground transportation for Canadian shippers increased 0.8 percent in February over January's results, according to results published today by the Canadian General Freight Index (CGFI).

·         This is the 12th consecutive monthly increase, bringing the CGFI 10 percent above March 2011.

·         The Base Rate Index also increased slightly, rising .5 percent over January's result. Base rates have risen 4.4 percent since March 2011. (The Base Rate Index does not include accessorial charges.)

·         Avergage Fuel Surcharges have increased from 18.79 percent of Base Rates in March 2011 to 20.42 percent in February 2012.

·         “The CGFI has now hit a 10 percent increase milestone year over year” said Doug Payne, president and COO, Nulogx. “Yearly base rate increases appear to be sticking, while remaining increases are being spread across fuel and accessorial charges," Payne summed up.

·         Nulogx Starts LinkedIn Group

·         This might be up your alley. Freight Cost Management is a new LinkedIn networking and discussion platform for those interested in reducing freight costs and improving transportation processes. Sponsored by the Canadian General Freight Index, the goal is to promote discussion and provide information on both freight cost reduction strategies and opportunities to improve transportation processes in general.

·         In order to fuel focused discussions, this group is restricted to those logistics professionals working directly with manufacturers, distributors, wholesalers, and other qualified shippers. 

Please feel free to comment to any of the posts on this blog. The intent is to start discussions on the subject content. If you have articles for post or comments about the blog in general please contact: Thank you Preferred Logistics----------- www.preferredlogistics.biz

OTTAWA — Take a look in the mirror and stop blaming other groups for trucking-related labor problems, says a new report by the Canadian Trucking Alliance (CTA).

OTTAWA — Take a look in the mirror and stop blaming other groups for trucking-related labor problems, says a new report by the Canadian Trucking Alliance (CTA).

Titled CTA Blue Ribbon Task Force on the Driver Shortage, the report aims to take a "comprehensive and honest attempt to tackle" the impending shortage of qualified commercial drivers in Canada.

The key conclusions of the report are:

·         Truck drivers are our most important asset, the face of the industry -- to our customers and to the public, and they are deserving of respect.

·         Truck drivers should have an improved ability to predict what their weekly pay is going to be; compensation packages need to be competitive with or better than alternative employment options and more transparent;

·         Truck drivers should be paid for all the work that they do and earn enough to cover all reasonable out-of-pocket expenses incurred while on the road for extended periods.

·         (Drivers’) time at work should not be wasted — at shipper/consignee premises, waiting for their trucks in the shop, or waiting for a response to a question of their carrier;

·         (Drivers) should be able to rely on their carrier not to interfere with their personal time by (for example) calling them back to work early;

·         Driver wellness should be a top priority for employers;

·         A minimum standard of entry level, apprenticeship or apprenticeship-like truck driver training should be mandatory;

·         Truck driving should be considered a skilled trade and be recognized as such by the various levels and branches of government, standards councils, etc., who certify such things.

Please feel free to comment to any of the posts on this blog. The intent is to start discussions on the subject content. If you have articles for post or comments about the blog in general please contact: Thank you Preferred Logistics----------- www.preferredlogistics.biz

Truck Makers Report Choppy Order Volume in First Quarter

Truck Makers Report Choppy Order Volume in First Quarter
By Deborah Lockridge, Editor in Chief

Demand for Class 8 trucks "has hit a soft patch," but at least one industry analyst expects that to be temporary.

March Class 8 new and net orders of 22,038 and 20,025 units, respectively, were the lowest order volume since last July, reports ACT Research Co.

"Class 8 demand, as expressed by incoming orders in February and March, has hit a soft patch," says Kenny Vieth, president and senior analyst at ACT. "There was a tax-driven prebuy at the end of 2011, and dealers added larger than seasonal stocks in Q1 ahead of rising model year '13 new truck prices.

"For a lot of truckers, the gap between new and used prices remains particularly large. Given all of the above, plus rising diesel prices through Q1, it is not too hard to see why the industry has softened. However, we think a continuation of reasonable freight growth, strong trucker profits, and healthy used truck prices will push demand higher once the current period of uncertainty is worked through."

At the Mid-America Trucking Show a few weeks ago, Paccar's Dan Sobic was asked about the choppy order intake we'd seen in the first quarter. He said that quoting activity was on the rise in October, November, December and January, but "February and March has dropped a little bit."

Like Vieth, Sobic blamed uncertainty. He said if a fleet really needs 50 trucks because it put off buying during the recession, that fleet manager might decide right now to order only 40 trucks because he wants to see how things go.

"Let's call it a thoughtful reconsideration," he said, noting that "I think the volume and freight is going to continue to grow, so I continue to believe the year will be strong."

Kenworth laid off 10% of the workers at its Chillicothe, Ohio plant earlier this month.

ACT's forecast already expected the industry to reduce build rates in Q2 (-4.5%), so the news generally fit its expectations, Vieth says.

"Build earlier this year was too strong relative to the rate of incoming orders. As an example, at the end of February, the three- and six-month order trends were at 296,000 annual rates, while build in February occurred at a 320,000 annual rate. Tack on continued order weakness into March and I think there is a good case to be made for a pullback in production in the near-term."

ACT's forecast is currently sitting at 299,000.

Please feel free to comment to any of the posts on this blog. The intent is to start discussions on the subject content. If you have articles for post or comments about the blog in general please contact: Thank you Preferred Logistics----------- www.preferredlogistics.biz

Short-Term Energy and Summer Fuels Outlook

Short-Term Energy and Summer Fuels Outlook

Natural Gas Price Residential Sector, U.S. Average

Jan-2011Jul-2011Jan-2012Jul-2012Jan-2013Jul-2013

01020

dollars per thousand cubic feetprojections

Source: Short-Term Energy Outlook

·         Month : Mar 2013
4.17 dollars per gallon

Heating Oil Retail Price Incl Taxes, U.S. Average

Jan-2011Jul-2011Jan-2012Jul-2012Jan-2013Jul-2013

0.02.55.0

dollars per gallonprojections

Source: Short-Term Energy Outlook

• Diesel Fuel Retail Incl Taxes U.S. Average

Jan-2011Jul-2011Jan-2012Jul-2012Jan-2013Jul-2013

0.02.55.0

dollars per gallonprojections

Source: Short-Term Energy Outlook

• Electricity Price Residential Sector, U.S. Average

Jan-2011Jul-2011Jan-2012Jul-2012Jan-2013Jul-2013

01020

cents per kilowatthourprojections

Source: Short-Term Energy Outlook

• Gasoline Regular Grade Retail Price Incl Taxes, U.S. Average

Jan-2011Jul-2011Jan-2012Jul-2012Jan-2013Jul-2013

0.02.55.0

dollars per gallonprojections

Source: Short-Term Energy Outlook

• Natural Gas Price Residential Sector, U.S. Average

Jan-2011Jul-2011Jan-2012Jul-2012Jan-2013Jul-2013

01020

dollars per thousand cubic feetprojections

Source: Short-Term Energy Outlook

• Heating Oil Retail Price Incl Taxes, U.S. Average

Jan-2011Jul-2011Jan-2012Jul-2012Jan-2013Jul-2013

0.02.55.0

dollars per gallonprojections

Source: Short-Term Energy Outlook

Highlights

• EIA has lowered the forecast 2012 average U.S. refiner acquisition cost of crude oil by $2 per barrel from last month’s Outlook to $112 per barrel, still $10 per barrel higher than last year’s average price. EIA expects the price of West Texas Intermediate (WTI) crude oil to average about $106 per barrel in 2012, the same as in last month’s Outlook but $11 per barrel higher than the average price last year. Constraints in transporting crude oil from the U.S. midcontinent region contribute to the expected discount for WTI relative to other world crude oil prices. EIA expects WTI prices to remain relatively flat in 2013, averaging about $106 per barrel, while the average U.S. refiner acquisition cost of crude oil averages $110 per barrel.

• During the April-through-September summer driving season this year, regular gasoline retail prices are forecast to average about $3.95 per gallon, peaking in May at a monthly average price of $4.01 per gallon. EIA expects regular gasoline retail prices to average $3.81 per gallon in 2012 and $3.73 per gallon in 2013, compared with $3.53 per gallon in 2011. The June 2012 New York Harbor Reformulated Blendstock for Oxygenate Blending (RBOB) futures contract averaged $3.28 per gallon for the five trading days ending April 5. Based on the market value of futures and options contracts, there is a 40 percent probability that its price at expiration will exceed $3.35 per gallon, consistent with a monthly average regular-grade gasoline retail price exceeding $4.00 per gallon in June.

• The warmer-than-normal weather this past winter contributed to high natural gas working inventories that continue to set new record seasonal highs, with March 2012 ending at an estimated 2.48 trillion cubic feet (Tcf), about 57 percent above the same time last year. EIA’s average 2012 Henry Hub natural gas spot price forecast is $2.51 per million British thermal units (MMBtu), a decline of $1.49 per MMBtu from the 2011 average spot price. EIA expects that Henry Hub spot prices will average $3.40 per MMBtu in 2013.

• EIA expects electricity generation from coal to decline by about 10 percent in 2012 as generation from natural gas increases by about 17 percent. EIA forecasts that electricity generation from coal will increase by about 7 percent and generation from natural gas fall by 3 percent in 2013 as projected coal prices to the power sector fall slightly while natural gas prices increase, allowing coal to regain some of its power sector generation share.

Please feel free to comment to any of the posts on this blog. The intent is to start discussions on the subject content. If you have articles for post or comments about the blog in general please contact: Thank you Preferred Logistics----------- www.preferredlogistics.biz

Crude oil stocks in U.S. at historic highs as American gasoline usage declines

Crude oil stocks in U.S. at historic highs as American gasoline usage declines

By Eric Nalder
Hearst Newspapersdenverpost.com

At midnight on April 11, a 940-foot tanker maneuvered into the dock at the oil terminal in Valdez, Alaska, carrying an unusual cargo for a returning ship.

Sloshing in its tanks were more than 12 million gallons of Alaskan crude, at least a quarter of the cargo the ship had carried away from Valdez two weeks earlier.

The Alaskan Explorer had sailed to a Washington state refinery but was forced to return to Alaska with 300,000 barrels because the onshore storage tanks were too full to accept it, Anil Mathur, chief executive of the Alaska Tanker Co., which owns the ship, confirmed last week.

"Not the normal course of business," said John Kotula, one of the few outsiders privy to the incident because of his position as manager of the state of Alaska's environmental office in Valdez.

The tanker's inability to offload its oil underlines a startling reality: Crude oil stocks in the U.S. have been for the last two years at historic highs, while Americans are using decreasing amounts of its most important product — gasoline. The Gulf Coast is particularly glutted with crude, due in part to a pipeline bottleneck. But federal statistics show another recent development: West Coast refineries are decreasing their production as the domestic demand for gasoline shrinks.

"If there is so much crude oil around, why is the price of gasoline so high? Why is the price of heating oil so high?" asked Dan Lawn, an environmental consultant who was in the same job as Kotula for decades before he retired in 2005.

The BP refinery in northern Washington had been shut down due to a February fire when the Alaskan Explorer arrived there on April 6. But that doesn't explain the tanker's return to Valdez with a big load of oil. Refinery spokesman Bill Kidd acknowledged that in normal times, the ship would have offloaded the remainder of its cargo at a nearby refinery (there are three of them).

Hauling oil to Valdez — a remote town that still supplies a big portion of the West Coast's oil — is carrying the proverbial coal to Newcastle. It is a sign that the American oil industry is in a very unaccustomed place.

Government statistics show gasoline isn't selling the way it used to, and on any given day, crude oil could be backed up in storage tanks ranging from Valdez to the San Francisco Bay to Long Beach.

"Valdez inventories are pretty high. Our inventories are high. Nobody is taking much crude on the West Coast," Kidd said.

So why aren't gasoline prices pushed downward by the forces of supply and demand?

"You've keyed into an interesting puzzle, a paradox," said Richard Newell, professor of energy and environmental economics at Duke University and, until last year, the head of the federal Energy Information Administration, which tracks statistics generated by the oil industry.

The answer, Newell said, is the power of the world market.

"We are tied to the global market, the global price for oil," said Rayola Dougher, senior economic adviser at the American Petroleum Institute. "We cannot secede."

The profitable oil-production industry benefits financially from the fact that it operates within a global market. Fuel conservation in the United States — however laudable— cannot overcome the rising hydrocarbon demand in emerging markets such as China and India, Newell said. The price stays up, even where more local market pressures might force it down.

Nationally, gasoline prices at the pump have risen 30 cents a gallon since March of last year, and more than a dollar in the past two years, according to the Energy Information Administration. The highest prices are mostly on the West Coast.

The Obama administration has proposed better oversight of the commodities market that trades in oil futures, but it is a limited gesture. The markets that set crude prices are different for Scandinavian oil, West Texas crude and Arabian oil. The prices will vary. But as commodity speculators and Asian buyers make their daily trades, the prices these days are relentlessly high.

"The dynamics in the United States are the opposite of what is occurring at a global level," Newell said.

If prices at U.S. gas stations go down — or up— it will be for reasons other than U.S. intervention or our improved driving habits, he said.

Consumer demand for gasoline in the U.S. started faltering in 2005 and has been falling "very sharply" since 2007, said Houston-based oil industry analyst Pavel Molchanov.

"We think (demand) is going to go down in perpetuity," Molchanov said.

"Probably the most gasoline that will ever be consumed in the United States was in 2007, and it will all be downhill from here," Kidd said.

People are driving less because of the recession and the aging of baby boomers, said James Beck, a lead petroleum supply analyst for the Energy Information Administration.

Newer cars get better mileage and are replacing gas-guzzling older ones, and people are using other means of transportation; Amtrak ridership rose 4.5 percent in 2011 to a new high, Molchanov added.

609,000

Barrels of oil a day, on average, that have coursed through the trans-Alaska pipeline this year, just over a quarter of what flowed through it during the 800-mile line's heyday in the late 1980s

11 million

Barrels of oil a day imported to the United States, according to the Energy Information Administration

Please feel free to comment to any of the posts on this blog. The intent is to start discussions on the subject content. If you have articles for post or comments about the blog in general please contact: Thank you Preferred Logistics----------- www.preferredlogistics.biz

Diamond International Breaks Ground for Springfield, Mo., Dealership - Source Trucking Info

Diamond International Breaks Ground for Springfield, Mo., Dealership

Diamond International of Springfield, Mo., a local International Truck dealership, held a groundbreaking ceremony on April 4 at 2635 East Diamond Street, the future home of the new facility.

The new dealership will have 15 drive-through service bays, a full-length wash bay, dedicated Accelerated Service bays, more than 20,000 square feet of parts storage and a drivers' lounge with flat screen TV, internet access and free Wi-Fi. Diamond International will build in several environment-friendly features such as a heating system using recycled waste oil, energy-saving lighting systems and energy-efficient insulation and window products.

"Diamond International of Springfield has been providing great service to our customers for more than 30 years," says Dick Sweebe, president and CEO of Diamond Companies and former Heavy Duty Trucking/American Truck Dealers Truck Dealer of the Year. "In order to support market growth for the long haul, we are building a new state-of-the-art facility that will deliver a higher standard of value to customers in the Springfield market."

Please feel free to comment to any of the posts on this blog. The intent is to start discussions on the subject content. If you have articles for post or comments about the blog in general please contact: Thank you Preferred Logistics----------- www.preferredlogistics.biz

More Carriers Using Broker Services - Source HDT

Please feel free to comment to any of the posts on this blog. The intent is to start discussions on the subject content. If you have articles for post or comments about the blog in general please contact: Thank you Preferred Logistics----------- www.preferredlogistics.biz

Retail Container Traffic Predicted to Increase 3.2% in April -Source Logistics News

Retail Container Traffic Predicted to Increase 3.2% in April

Import cargo volume at the nation's major retail container ports is expected to increase 3.2% in April compared with the same month last year. Year-over-year gains should continue through the end of summer, according to the monthly Global Port Tracker from the National Retail Federation and Hackett Associates.

"Retailers are continuing to watch rising gas prices, but job gains and other indicators show the economy is strengthening," says NRF Vice President for Supply Chain and Customs Policy Jonathan Gold. "All of this should improve consumer confidence and lead to increased spending, so retailers are cautiously building up their inventories."



U.S. ports followed by Global Port Tracker handled 1.04 million Twenty-foot Equivalent Units in February, the latest month for which after-the-fact numbers are available. With February traditionally the slowest month of the year, that was down 16% from January and 5.7% from February 2011. One TEU is one 20-foot cargo container or its equivalent.


March was estimated at 1.19 million TEU, up 9.6% from a year ago, and April is forecast at 1.25 million TEU, up 3.2% from last year. The first half of 2012 should total 7.3 million TEU, up 2.2% from the same period last year. The total for 2011 was 14.8 million TEU, up 0.4% from 2010's 14.75 million TEU.

NRF continues to project 2012 retail sales will grow 3.4% to $2.53 trillion.

"Our forecast for the remainder of the year has brought us back to the traditional peak season patterns," says Ben Hackett, Hackett Associates founder. "Hopefully the importers and the carriers can work closely together to ensure sufficient capacity and a solid supply chain."



Global Port Tracker, which is produced for NRF by the consulting firm Hackett Associates, covers the U.S. ports of Long Angeles/Long Beach, Oakland, Seattle and Tacoma on the West Coast; New York/New Jersey, Hampton Roads, Charleston and Savannah on the East Coast, and Houston on the Gulf Coast.


Please feel free to comment to any of the posts on this blog. The intent is to start discussions on the subject content. If you have articles for post or comments about the blog in general please contact: Thank you Preferred Logistics----------- www.preferredlogistics.biz

Diesel to Average $4.21 This Summer; Crude to Average $112 - Source Trucking Info

Diesel to Average $4.21 This Summer; Crude to Average $112

Diesel fuel prices, which averaged $3.94 per gallon last summer, are projected to average $4.21 per gallon this summer, according to the Energy Information Administration's Short-Term Outlook. Monthly prices will peak at $4.25 per gallon in the middle of the driving season, the EIA predicts.

Regular gasoline retail prices are forecast to average about $3.95 per gallon, peaking in May at a monthly average price of $4.01 per gallon. EIA expects regular gasoline retail prices to average $3.81 per gallon in 2012 and $3.73 per gallon in 2013, compared with $3.53 per gallon in 2011.

EIA has lowered the forecast 2012 average U.S. refiner acquisition cost of crude oil by $2 per barrel from last month's Outlook to $112 per barrel, still $10 per barrel higher than last year's average price. EIA expects the price of West Texas Intermediate (WTI) crude oil to average about $106 per barrel in 2012, the same as in last month's Outlook but $11 per barrel higher than the average price last year. Constraints in transporting crude oil from the U.S. midcontinent region contribute to the expected discount for WTI relative to other world crude oil prices.

EIA expects WTI prices to remain relatively flat in 2013, averaging about $106 per barrel, while the average U.S. refiner acquisition cost of crude oil averages $110 per barrel.

The warmer-than-normal weather this past winter also contributed to high natural gas working inventories that continue to set new record seasonal highs, with March 2012 ending at an estimated 2.48 trillion cubic feet (Tcf), about 57% above the same time last year. EIA's average 2012 Henry Hub natural gas spot price forecast is $2.51 per million British thermal units (MMBtu), a decline of $1.49 per MMBtu from the 2011 average spot price. EIA expects that Henry Hub spot prices will average $3.40 per MMBtu in 2013.

Daily and weekly national average prices can differ significantly from monthly and seasonal averages, and there are also significant differences across regions, with monthly average prices in some areas exceeding the national average price by 25 cents per gallon or more.



Please feel free to comment to any of the posts on this blog. The intent is to start discussions on the subject content. If you have articles for post or comments about the blog in general please contact: Thank you Preferred Logistics----------- www.preferredlogistics.biz