An Introduction to Lubricant toxicity

Lubricants are a very common fluid found in the industrial or commercial workplace. Their use is without a doubt vital to the success of any piece of equipment or machinery; however, these fluids are at their purest form chemicals and additives that are meticulously chosen to produce a fluid that keeps engines running smoothly and gears turning. According to an article form Machinery Lubrication Base oils are grouped into five different groups that quantify their total carcinogenicity, as designated by The American Petroleum Institute or API.

Group1: These are lubricants with sufficient evidence of carcinogenicity to humans. This group includes base oils that are acid-treated oils, mildly retreated solvent-refined oils, aromatic oils, and mildly hydro-treated oils.

Group 2: These are lubricants with no human data, but strong animal data exist that indicate possible or probable carcinogenicity. There are no bad oils listed in this group.

Group 3: These are lubricants not classifiable as to carcinogenic to humans. They include base oils that are white oils and petrolatum.

Group 4: These are lubricants that are probably not carcinogenic to humans. This group includes base oils that are white oils and petroleum.

Group 5: These are all other oils including vegetable oils and natural esters.

These classifications are based on a measure of carcinogen levels found within the mixture. According to cancer.org, a Carcinogen is an agent that facilitates the growth of cancer. Cancer is defined as an uncontrolled division of cells caused by a mutation within the DNA of the cell. Carcinogens facilitate the mutation of the cells by either causing the mutation of the cell or increasing the rate at which cells multiply, increasing the permutations that may cause a change in DNA makeup.

Most petroleum-based lubricants are created with polyalphaolefins (PAOs). “The term synthetic” came about in the 60’s when PAOs were first introduced. Synthetic oils are considered harmless and contain no carcinogens.

Other than cancer-causing agents, toxic components found in petroleum make ingesting a lubricant a very dangerous and poisonous endeavor. Motor oil and hydraulic fluids belong to a large class of compounds called hydrocarbons. Hydrocarbons are an organic compound consisting entirely of hydrogen and carbon. Most hydrocarbons found on Earth naturally occur in crude oil, where decomposed organic matter provides an abundance of carbon and hydrogen which, when bonded, can catenate to form seemingly limitless chains.

Alternative fuels - biodiesel service California

According to an article from poison.org on hydrocarbons, Hydrocarbons In their simplest form, hydrocarbons are combinations of carbon and hydrogen atoms”. There are many varieties of hydrocarbons, but all hydrocarbons tend to feel oily to the touch when in their liquid state. When these oily substances are swallowed, the worry is that they can slip into the airway or be inhaled later during the process of vomiting. This is called aspiration, which can be very irritating and lead to infection. The airway is right next to the food pipe, and the close proximity is the reason aspiration happens. The ease of which a substance can flow is the characteristic known as viscosity. Low viscosity (thinner) hydrocarbons are more likely to be aspirated than high viscosity (thicker) hydrocarbons.

Thank you for taking the time to read this article. If you found this article useful in any way then please consider subscribing for more news and articles related to the petroleum industry.

 

-The SC Fuels Team

Your guide to the Diesel Engine

In one of our first articles we went over 5 amazing facts about diesel fuel. In today’s article we will be continuing where we left off as we go into the specifications of the diesel engine. What makes them different from standard gasoline engines, and what role they play on the current economy. It’s not privileged information to know that there are a great many industrial vehicles and equipment that use diesel engines and fuel as a main source of functionality. Why is it that we use two different engines in our economy?

Diesel and gasoline engines are a lot more a lot more alike than you would think. Theoretically they function the same; they both combust chemical energy fro fuel. they both turn that energy into mechanical energy by moving pistons within a cylinder. This repetitive circular motion is what causes your wheels to move your vehicle forward. The difference in these engines is not their function exactly, but rather the way the fuel is combusted and how oxygen is involved.

Diesel Engine, Diesel fuel

For gasoline engines, air and fuel are injected into the combustion chamber together . Then they are both pressurized, finally  the fuels are ignited by the spark plug to cause the reaction. In diesel engines, the air is pressurized in the chamber before fuel is injected. As air temperature rises with pressure once the pressure threshold is reached a combustion is achieved and all the benefits that come with it.

The diesel engine differs in other ways as well, cylinders are larger to capture  more air to be combusted. Because the temperature of air must reach a critical level for combustions to take place sometimes in colder weather it gets difficult to reach an appropriate level. Combustion engines contain what is known as a “glow plug”. These heating wires keep the combustion chamber at an appropriate temperature during the cold seasons when starting a diesel engine would fail from a Cold Start.

In a standard gasoline engine, the combustion process is as follows.

  1. Intake stroke- Fuel is introduced to air
  2. Compression stroke- piston moves up, then air and fuel mixture are compressed
  3. Ignition Stroke- Fuel/air is ignited with a spark plug
  4. Exhaust stroke- piston goes up pushes exhaust through exit valve

In diesel engines the four strokes are still the same, however the introduction of fuel is delayed.

  1. Intake stroke- intake valve opens only air is entered in the chamber
  2. Compression stroke- Piston moves to compress air heats it more than 540°C
  3. Combustion stroke- fuel is injected into the chamber and introduced into the super-heated air causing a combustion of the materials
  4. Exhaust stroke. Exhaust is ejected through the exhaust valve as the piston goes up.
Diesel Engine, Diesel fuel
Image credit NCH Europe and Re: Solutions Link

These mechanical differences are not the only thing separating the 2 engine types. The fuel itself plays a large part into the differences between the two engines. Diesel fuel still has the bones of dinosaurs floating in it. Its simply that regular unleaded gasoline has a significantly lower combustible temperature than diesel. Fuel is added much later in the combustion cycle for diesel fuel, during the 2nd rotation fuel is introduced to produce a combustion that will complete the rotation and ensure energy is getting to your tires.

Created by Rudolf Diesel (where diesel gets its name from) the Diesel engine is a fascinating system of heat and moving parts that has revolutionized the landscape of the civilized modern world. Diesel accounted for about 21% of the petroleum fuels consumed by the United states and that number is expected to rise in 2018 and 2019. If you have enjoyed this, please consider subscribing for more about the fuel industry.

 

Sincerely

-The SC Fuels team

What does the color of your oil mean

 

Over time, the quality, consistency, and color tend to change on your oil-based lubricants this is because of many factors that directly “age” your oil. As a rule of thumb, color does not dictate the efficiency of oil. Color will change for a variety of reasons from heat, additives, and contaminants to something as simple as water and coolant so judging an oil’s efficiency on color alone is not possible. With that said let’s look into what we CAN learn from oil color.

First, color doesn’t necessarily mean anything. Oil can be very, very dark (black even) and still be effective. However, as a general rule:

  • New, clean oil is amber in color
  • As engine oil gets darker, it can indicate a) high heat, b) contaminants, or c) the presence of additives that cause the oil to darken during normal

Lubricant- Grease- Oil - Fuel

Next, let’s talk about the engine colors that indicate problems.

Milky, foamy, or cream colored oil can be an indicator of a head gasket leak if your exhaust is producing white smoke, or your vehicle is leaking coolant. Simply looking right under your equipment of vehicles oil cap should reveal if your equipment is suffering from milky or frothy oil. Typically this happens if the oil is exposed to water after raining or the equipment is not used long enough for the water on the engine to evaporate and burn off.

Thick, black, or very dark oil usually indicates that your oil has been exposed to dirt or dust contaminants that lead to a soot build up. Direct injection gasoline engines produce soot over time that causes standard motor oil to turn black and thick. Soot is a byproduct of incomplete combustion and since soot particles are less than one micron in size they typically do not cause much engine ware. The problem with soot happens when the soot particles begin to agglomerate into larger wear-causing contaminates. This is where the black thick texture may come from.

Alternative fuels - biodiesel service California

Let’s also crack the myth that the color of your oil indicates when it is time to change your oil. It is very common for people to assume that there is a correlation between the color of oil, and the need to change the oil. This is not necessarily the case. Many of the changes and elements your oil is exposed to will change the color so there is no actual way to tell if your vehicle needs to be changed by just looking at it.

These are the big color indicators to look out for in your oils and lubes. As you have learned there is no sure-fire way to know what is wrong with your oil by just looking, however, these are some indicators that it may be time to replace or look into what is wrong with your storage. We hope very much that you have learned something new. If you are new to the SC Fuels blog, then consider subscribing for more useful and interesting topics!

Sincerely,

-The SC Fuels Team.

Octane? Whats that?

Octane is a flammable hydrocarbon of the alkane series, obtained in petroleum refining. That’s a long way of saying higher octane means higher explosion point. Meaning you want more of it for your combustible engine. Octane numbers tend to change as additives improve and the quality of oil refining increases. Octane numbers to the uninitiated mean about as much as hieroglyphics to a non-archeologist. So let’s dive down deep into the octane-fueled rabbit hole that is fuel quality. Prepare to be amazed.Octane Fuel - diesel fuel

To begin the lesson we should learn how modern combustible engines work. High-pressure chambers in your engine are constantly filling with vapor and combusting to produce the energy needed to keep your vehicle moving down the road. Now the vapor that fills the chamber is highly pressurized fuel from your vehicles gas tank. Depending on the octane level of the fuel or the quality of fuel combustion can take place at different times during the rotation of the cylinder. The point of combustion is vital to the efficiency of an engine as misfires mean that no energy is produced by a rotation.

So now that we know how combustion engines work, what part does the fuel we put into our vehicles play? Well, we spoke briefly about misfires (basically what happens when the internal combustion takes place at the wrong time) but we did not get into what causes them and what the quality of fuel means to your engine. The igniting point of all of the fuel is about 4500 degrees Fahrenheit (about 2500 degrees Celsius). This is crucial to the internal equation of ignition in your car.

Octane Fuel - diesel fuel

You may be wondering what octane and fuel quality mean for your internal combustion engine (ICE)? Well, to begin with, higher octane has a very positive effect on the environment. By using up more of the fuel in the chamber less emission is produced from the ignition. More used = less released. A study from MIT in 2014 even suggests that higher octane fuels could cut our annual CO2 emissions by 35 million tons. Besides the environmental benefits, higher octane fuel puts out more energy per rotation than standard fuel meaning that your vehicles fuel economy is positively affected.

Now that we understand the use and benefits of higher octane fuels lets go back and re-visit those numbers on the pumps 87, 89, and 93. 87 is standard fuel. That is all. In actuality 87 is the standard octane rating that all gas stations provide. Because most vehicles engines are designed with this octane rating in mind, fueling with anything lower can negatively affect your engine. If fuel is ignited earlier in the cycle then the piston could be pushed down while it is rising, potentially causing long-term damage to the piston and in turn your engine. 89, and 93 are designed to withstand much more heat and pressure before igniting, meaning that you’re ICE should be able to make the most use of the vapor it has in its chamber.

Now that we have learned about octane ratings will you be changing how you fuel car? Consider reading our Ultimate guide to fuel prices for more fuel information. If you found any of the information in this article useful, consider subscribing for more fuel news Otherwise thank you for reading!

 

Sincerely

-The SC Fuels Team

Your Ultimate Guide To Oil Prices

The oil and petroleum industry can seem like a volatile and unpredictable market where prices are always changing. But understanding the underlying factors that go into oil prices will help to clear the fog over the oil market. According to a new article published by CNBC, the three top factors that influence the price of oil are; supply, demand, and geopolitics. So today in our ultimate guide to oil prices we will dive down into the real reasons oil prices are always changing, and what causes them. Welcome to SC Fuels Ultimate Guide to Oil Prices.

Supply and demand is the fundamental cornerstone of economics. The more of a demand for something vs the amount of supply of said thing are related in the form of high to low. High supply and low demand mean that prices should be low or dropping. Low supply and high demand would mean that the opposite is true. In the case of oil, supply is determined by countries that are part of OPEC. As of lately, the United States role to play in the global oil supply has grown thanks to the booming growth and production from shale fields.  When the global output of oil is more than the public can consume then prices drop like they did during the infamous low of 2014.

2014 was the year of the great oil crash. From 2000 to 2008 oil saw an unprecedented increase in price per barrel, growing from $25 to $150. This increase can be attributed to the direct increase in demand from developing first world economies, like China and India. Other countries such as Russia and Brazil were also in a state of dramatic oil consumption that led to an unquenchable demand of oil. The price remained around $125 until 2014 when it went into freefall. Around 2010 the demand for oil plateaued but the production of oil barrels continued at its maddening rate. The production of oil eclipsed the demand by 2014 leading to more oil than the world could use… and the free fall of prices that bottomed out at $40 per barrel.

In the 2014 scenario, we learned that trends in consumption play a huge role in the price of fuel however it falls back to the fundamental creed of economics. Supply vs demand. When the supply of oil was at an all-time high, the demand was not there to satiate it, hence the drop in price. There are other factors that do go into the final cost, things like Refining costs vs profit, distribution, marketing, and taxes. Refining costs are usually varied seasonally. This is why fuel costs increase during the summer months, while also taking into account any additives such as ethanol and other chemicals that reduce CO2 emissions all factor into the final cost of these barrels

The EIA or the United States Energy Information Administration states that of each barrel 61% is the cost of crude oil, 15% us federal and state taxes, 12% is distribution and marketing, and 12% is refining costs and profits. Looking deeper into the supply and production of oil we see that an overwhelming majority of all oil is produced by OPEC. This places tremendous power in their hands in deciding the price for fuel. This has led to the increase in production of oil in large economic powers such as the United States and Russia, as well as an increase in the production of alternative fuels such as shale oil and biofuels.

Oil prices have now evened out at around $70 per barrel at the time of this writing, and have stabilized to a point where drops and increases have been negligible. So following the standard pricing model in the graphic above, you can see how the general price of oil is calculated.

Thank you very much for taking the time to read the SC Fuels ultimate Guide to oil prices. We hope you have learned something about the price of oil and maybe something about how the fuel industry is run. Consider subscribing if you are interested in learning more about the Oil industry and all of the intricacies that go into making the gears turn,

 

Sincerely

-The SC Fuels Team.

 

State of Global Energy and Emissions.

The IEA (International Energy Agency) has published their yearly Global energy report and it is showing some interesting developments, market changes, and growth. Today we will explore the data that is presented in the report, and detail as closely as we can. The report was published in March of 2018 with data that has been aggregated from different sectors of the energy industry. The reports key findings are as follows:

 

  • Global energy demand has increased by 2.1% in 2017, compared to 0.9% in 2016 following the trend of global increase of .9% for the last 5 years.
  • Global energy-related CO2 emissions grew by 1.4% in 2017, reaching a historic high of 32.5 gigatonnes (Gt)
  • Global natural gas demand grew by 3%
  • Global coal demand rose about 1% in 2017, reversing the declining trend seen over the last two years.
  • World electricity demand increased by 3.1%, significantly higher than the overall increase in energy demand

Global energy demand

According to the IEA report, global energy demand grew by 2.1% more than twice the growth rate of 2016 and the prior 5 years. Fossil fuels met 70% of the growth in energy growth all around the world. Natural gas demand increased to a record share of 22% in total energy demand and finally nuclear accounted for 2% of the growth.

Energy and Emission -Fuel Delivery

CO2 emissions

According to the report “Global energy-related Co2 emissions rose by 1.4% in 2017, an increase of 460 million tons (Mt) and reached a historic high of 32.5 Gt.” Last year’s growth came after three years of flat emissions and contrasts with the sharp reduction needed to meet the goals of the Paris agreement on climate change.”

Energy and Emission -Fuel Delivery

The increase in carbon emissions is a direct result of the 3.7% global economic growth, lower fossil fuel prices, and weaker energy efficiency efforts. These three factors were the main contributors to pushing up global energy demand by 2.1%, however, the emission growth trend was not universal. Although many major economies saw a rise in carbon emissions, some others experienced declines, such as the United States, the United Kingdoms, Mexico, and Japan.

Of all of the countries in emission decline, the biggest came from the United States by 0.5% or 25 million tons of CO2, marking the 3rd consecutive year of emission decline. In the United Kingdom, emissions dropped by 3.8% or 15 million tons to 350Mt, the lowest level on record since 1960. A continued shift away from coal towards gas led to a 19% drop in coal demand in Mexico, and emissions dropped by 4%.

Energy and Emission -Fuel Delivery

Global Oil demand has risen by 1.5 million barrels a day (MB/d) since 2016. Since the price of oil dropped in 2014 there has been a trend of strong growth. The rate of growth in 2017 was 1.6% was much higher than the average annual growth rate of 1% seen over the past decade.

The IEA report contains more information on emission and alternative energy statistics. You can find the full report here. We hope you have found something valuable in our summary of the IEA report. If you would like to see more content that pertains to energy, oil, and our industry then consider subscribing to the SC Fuels blog.

 

Sincerely,

-The SC Fuels Team.

Store your lubes like a pro!

Lubricants- Lubricant delivery

 

Maintaining the quality of your oils, greases, and other lubricants is important to the longevity of your vehicle or machine. Contaminates, Gelation and exposure will ruin any store of lubricants, so are you doing all you can to combat them? The tendency of oil to gel at specific temperatures and with certain contaminants isn’t always a bad thing. In fact, this property has been used in cleaning up spilled oil, particularly oils spilled in large bodies of water. The Environmental Protection Agency employs “gelling agents” to form gels in spilled oil while not reacting with the water. These agents are blended into the oil slick through mechanical agitation or through the action of the waves in the body of water. Once the oil gels, the agents can then be easily removed by skimming or any other form of separation.

Gelation of oil comes from links between macromolecular chains that result in the formation of branched polymer structures with a solubility that depends on the chemical nature of the starting materials. As more and more of these chains form, the solubility of the compound decreases. This is the process of gelation the slow accumulation of molecular chains that make oil insoluble. Several mechanisms are involved in the acceleration of the gelation process.  One being temperature and the other being contaminates. Here are some storage and handling tips from the industry professionals to keep your lubes in prime condition.

Lubricants- Lubricant delivery

According to a Mobil technical article “Drums, pails, and cans of lubricants from virtually all suppliers are leak proof and clearly labeled with a brand name and type of lubricant inside. Careless handling, however, can cause leaks, contamination of the contents, and smudge, tear, or otherwise damage the labels. The 55-gallon drum is the most common lubricant container used by industry. Care is the key to safe drum handling. A full drum weighs about 450 lbs and, if handled carelessly, can injure workers or damage plant property. Do not unload drums by dropping them from the delivery truck or freight car to the ground or unloading dock. The drum’s seams can be punctured or burst, resulting in a hazardous spill situation.”

Greases are oil that has been thickened. Greases were created because liquid based lubricants do not remain at the point of application. Grease has a tendency to bleed while in storage. The ammount of bleed increases with time and, generally, with temperature. Up to a 5 percent bleed rate is considered acceptable. Contaminants can deteriorate grease performance. If containers are not tightly sealed, contaminants may enter the stored product. So how do you go about protecting and storing them? Like most materials, lubricating grease gradually will deteriorate with time. The rate and degree of deterioration depends on the storage and handling conditions to which the grease is exposed.

Lubricants- Lubricant delivery

According to Machinery Lubrication magazine “Always store grease in its original packaging and keep the container closed until it is time for it to be used. Wipe the lid or cover of the container before opening and always use clean tools and dispensing equipment when handling or pumping the grease. After use, the container should be closed immediately and kept closed. Before placing the lid back onto the container, wipe off any dust, dirt or excess grease that may have accumulated.”

What changes or steps will you take to ensure your lubes are safely stored? let us know in the comments below, and consider subscribing for more information on the ever-changing world of the fuel industry

 

Sincerely,

-The SC Fuels Team

Biodiesel the alternative fuel of the future?

Alternative fuels - biodiesel service California

What is Biodiesel? Is it sustainable? And is it cost efficient? These are all very common questions fleet managers, and company owners should be asking when considering the use of biodiesel for their trucks. Renewable and alternative fuel are all the rage these days. Lowering our carbon footprint, and contributing to the longevity of the earth is definitely a great and righteous deed, however the real pursuit of alternative fuels for businesses is to combat the ever-rising prices of fuel and oil. Today we will look into biodiesel and biofuels. We will find out how they are created, their functionality, their accessibility, and help you decide whether biodiesel is the alternative fuel source that your company could best utilize.

Biodiesel is an alternative fuel that is similar in structure and use to standard diesel. Biodiesel is created from animal fat, or vegetable oil through a process called transesterification to separate the glycerin from the base compound. Transesterification leaves behind 2 products, Methyl Esters (which is the chemical name for biodiesel) and glycerin which is a valuable substance, but is not used in the production of fuel. Biofuel is completely non-toxic and 100% biodegradable. Typically, biodiesel produces 60% less net carbon output than standard diesel. The stigma with biodiesel is that it does not carry the same power or fuel efficiency as standard diesel, but studies have shown that the efficiency loss for using biofuel is less than 5%!

 

  Diesel Cooking oil B100 B5
EMISSIONS
Unburned hydrocarbons, ppm 3 14 9 3
Carbon monoxide, % 0 0.01 0 0
NOx, ppm 237 214 248 240
Particulates (opacity %) 2.9 1.6 1.1 2.4
FUEL ECONOMY
City, mpg 20.1 20.8 22.3 22.6
Highway, mpg 44.9 42.1 44.2 48.5
ACCELERATION
0-30 mph, sec. 4.5 4.5 4.5 4.5
0-60 mph, sec. 15 14.9 14.5 14.2
1/4-mile, mph 69.9 70.3 71.3 72.2

Table and data are taken from consumerreports.org

While still in its infancy stages, biodiesel is growing to become one of the top alternative fuel options available today. Finding the best alternative fuel source has become the new search for El Dorado, and as such Europe seems to have doubled down on biofuel. Biodiesel is used by millions of car owners in Europe, particularly in Germany. With a market share of nearly 3% of the German diesel fuel market, biodiesel has become the number one alternative fuel – and its use will certainly continue to grow.

Alternative fuels - biodiesel service California

 

The process of creating these alternative fuels is through a chemical reaction that involves the following

Vegetable Oil + alcohol → biodiesel + Glycerin (Glycerol)

We spoke about it briefly in our opening, but the process of converting vegetable oils into biodiesel is called “Transesterification”. This process is a simple process of combining a chemical compound called an “ester” and an alcohol in order to make another ester, and another alcohol. The vegetable oil used in the process can be substituted with animal fats or any organic compound that are rich in Triglycerides, as they for the reactive base of biodiesel

Did you learn anything useful about alternate fuel or biodiesel? If you would like to learn more about other alternative fuel, the fuel industry, or general topics, then considers subscribing for new content! Or learn more about us at www.scfuels.com

 

Sincerely

-The SC Fuels Team

Tank Monitoring Systems and You.

What are some of the things that you do to make your everyday life easier? Do you set an alarm to wake you up at an early time? Do you have notifications turned on for an app that you use frequently? Do you have a bill set to automatically pay each month, rather than manually paying it? These are all things we do to simplify our modern day human experience. When keeping your workplace running efficiently, having a tool to simplify a task or responsibility is paramount to the success of your project. Fuel Management systems are a tool used help manage the cost, use, and volume of fuel at a workplace.

With the installation of a Fuel Management system, automatic updates and notifications will be uploaded and sent to you and your fuel supplier to ensure that you have fuel when you need, no matter the time. Many companies have not yet made the move to install these devices and service. A good inventory management strategy improves the accuracy of inventory orders, this helps alleviate the stress of inventory management on fleet managers and business owners when making informed purchasing decisions on fuel, ensuring that you are not over, or under spending on your fuel stock.

inventory management systems, tank monitoring system

A good Inventory Management strategy increases efficiency and productivity. The software provided with fuel monitoring systems are created to decrease the amount of time spent on your logistics. Tank management systems can cut down the time you spend on inventory by up to 1/3 by making information very easy to find, and prevent “overfilling” and “Run-outs” all together.

Some of the benefits to installing fuel tank monitoring systems are:

  • Reduced Operating Costs (Hard & Soft Costs)
  • Inventory Management & Fuel Transaction Tracking Services
  • Customized reports (usage, inventory, leak alarm, etc)
  • Prevent “Run Outs” and “Over Fills” – Low inventory alerts
  • Alarm histories/polling reports – Track the course of action to be taken
  • Optimized Fuel purchases – Buying at the right time!
  • Coordination with third party environmental compliance providers & regulators

 

Are you using Fuel tank monitoring systems? Are they working out for you? Let us know in the comments below what your experience has been. If you are interested in knowing more about what fuel tank monitoring systems SC Fuels has available let us know at www.scfuels.com/home/contact/

 

 

Sincerely,

 

-The SC Fuels Team.

 

Could 2018 be the best year ever for equipment sales? Wells Fargo Thinks so.

Construction Market - Fuel delivery - Fleet Cards

According to a new construction industry report and forecast published by Wells Fargo’s National Sales manager John Crum, 2018 is looking to become one of, if not the best year for construction equipment sales in United States history! The Optimism Quotient (OQ) is a survey used to benchmark contractor and equipment distributor sentiment on local nonresidential construction activity. This year (2018) has scored 133 a 10-point increase over 2017. Both residential and non-residential construction industry activity have shown an increase in optimism stemming from a high level of approval of the current tax reform.

construction industry- Fleet Cards - Diesel Fuel

An OQ score of 100 or more represents a very strong optimism for increased local construction activity relative to the level of activity in the prior calendar year. A score of 75 to 99 represents a more cautious outlook for the industry and below 75 signals a belief that the industry will decrease. According to Crum “This is the highest optimism we have recorded in the last 20 years so that in and of itself is really good news” The information provided by these reports is often used by equipment retailers to assess the health of the market and forecast potential sales.

construction industry- Fleet Cards - Diesel Fuel

This is the highest optimism we have recorded in the last 20 years so that in and of itself is really good news”

construction industry- Fleet Cards - Diesel Fuel

2017 was a very good year for construction equipment sales, and according to the construction industry outlook, it appears that 2018 will see further improvements and sales. The belief is that more than 76% of equipment distributors will see an increase in sales. Another effect this outlook has on the construction industry is that distributors expect a 55% percent increase in their rental fleets while only 7% said they will decrease their size, leading to more equipment sales and a general increase in market contribution.

While the data recorded above points to a very positive outlook for the Construction industry, finding and paying skilled labor remains the highest concern that may have a potential impact on net profits. For contractors, employee wages and other benefits (31%) and healthcare costs (18%) were the top of cost concerns. Distributors concerns over equipment costs (20%) and equipment rental costs (20%) remained the highest ranked. 50% of respondents said they were aware of pending changes to the accounting rules for leasing. Of the respondents that were aware 50% believe that these changes will greatly impact net profits, while 20% feel that there will be no impact at all.

 

“While the data recorded above points to a very positive outlook for the Construction industry, finding and paying skilled labor remains the highest concern that may have a potential impact on net profits.”

 

With the expected increase in equipment sales oil and lubricant suppliers have also taken precaution, increasing their stores while the cost of raw materials continues to rise. While not measured in the OQ report, the cost of fuel is always a factor in the estimation of net profit. Suppliers should anticipate a higher demand in energy and lubricant products to meet the growth in sales in the construction industry.

construction industry- Fleet Cards - Diesel Fuel

Will this projected growth in equipment and construction affect your company or you? What are your expectations from this forecast? Let us know below in the comments and consider subscribing for more news and information on construction, and many other industries.

 

Thank you

The SC Fuels Team