The Supply Chain and the effects of Fuel

GSC Logistics ∕ April

Theresa Neff:  Hi, I’m Theresa Neff and I’m here again today with our Senior Vice President of Strategy Joe Zepko. How are you today Joe?

Joe Zepko:  Hey, Theresa, I’m just doing fine. Thanks for asking,

Theresa Neff: Joe. I want to engage you in a fuel discussion again. I was just checking online and each week on Monday afternoon they released the new gasoline and diesel prices, both national and, you know, west coast California and I noticed that there was a softening in the national average, a softening in the pad five, but the California prices remain steady. I also know that President Biden is set to release 180 million barrels into the supply. What are your thoughts on all this?

Joe Zepko: Well, my personal opinion is a drop in the bucket. You know, that’s a nice number, but you know, it still has a drop in the bucket. You know, the crude prices when you see, and vital victories. I’m really proud that you’re looking into this on a weekly basis, being very cognizant of the fuel changes and so forth. I’m reading into a lot of analysts quoting about 100 to 100 and $10 on the crew for all this year. So, you know, looking back into the past four weeks, the California fuel has been hovering on the average of about 6.16. Yesterday, it was like a 6.28 previous week, 6.28, so forth. But on the average of the four weeks, it’s about 6.15 or something like that. So, you know, not a good news here. I think this six and a quarter type of a per gallon figures and probably prevail for probably a majority of the year. That’s our speculation, you know. So in a way, the fuel factor is probably gonna weigh heavily on the economy and supply chain. More so than some of the ILWU discussions which is going to kick off on May 12. You know, hopefully they’re gonna not have any slowdowns and everything like that. But The fuel factor is such a great one that the predictions of the GDP was earlier in the year around 3.5%. We’re probably talking about 2% right now for the growth for this year. So we could see a little bit of a slowdown in the economy and as we get past the peak season this year, yes, I think the cargo is gonna start dwindling down a little bit. So we’ll see.

Theresa Neff: Thanks Joe, always love getting your take on things very insightful and much appreciated. And I look forward to touching base with you again.

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