This week, gas in the Twin Cities west metro was priced anywhere from $1.72 to $1.89. As a flex fuel vehicle owner, it caught my attention.
With Christmas travel coming up for many, and holiday spending at a high, that&rsquo;s good news for consumers (but perhaps not so good for those who sell alternative fuel and related equipment, such as wood pellets, stoves and boilers). And it&rsquo;s expected to fall every more. Oil prices have hovered around $40 per barrel, and this morning WTI crude was at $35.66. Prices haven&rsquo;t been this low since the global financial crisis.
Goldman Sachs recently suggested that in the worst case scenario, oil prices could hit $20 per barrel. While unlikely, it could happen. Prices are forecasted to continue to dip, staying low until the end of next year.
Recently, our team was wondering about how this affects the bottom line of each of the sectors we cover&mdash;low diesel prices, that is&mdash;so we added that to the list of topics we&rsquo;re going to cover in the January issue of Biomass Magazine, our plant management, maintenance and repair issue.
In production now, the issue includes a feature article investigating this issue, a timely and well-written piece by our Senior Editor Ron Kotrba. In the story, &ldquo;The Untold Upside of Low Oil Prices,&rdquo; Kotrba speaks to executives managing all different kinds of renewable fuel facilities, and finds that it&rsquo;s not all doom-and-gloom when the cost of crude nosedives.
Kotrba spoke with R. Delbert LeTang, founder and CEO of SG Preston, a bioenergy startup with four biobased segments, who said:
&ldquo;At one time we were supplying wood chips to major global biomass company in the far Northeast when diesel prices were up as high as $4 a gallon&hellip;that translates into a delivered cost for wood chips that&rsquo;s fairly high. For endproduct pricing, customers look for parity with petroleum products, and high input costs make that more challenging. But when those input costs, or related costs for transport, decrease 40 to 60 percent, the companies that are more customer-centric pass on that savings to their customers while keeping some for themselves. It can have a very positive impact.&rdquo;
Presumably, it probably isn&rsquo;t the case across the entire board, but many of the sources Kotrba speaks with have found the silver lining.
Want to read more? The January issue will hit the printer late next week and should be available online soon after&mdash;be sure you don&rsquo;t miss out.
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In January Biomass Magazine story â€œThe Untold Upside of Low Oil Prices,â€� Senior Editor Ron Kotrba speaks to executives managing different renewable fuel facilities, and finds that it's not all doom-and-gloom when the cost of crude nosedives

The Silver Lining of Low Oil

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