Westminster will lock-in a $2 per gallon price for gasoline for most of its fleet for the next year. City Councilors voted April 27 to approve an agreement with Hill Petroleum, locking in the price …
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Westminster will lock-in a $2 per gallon price for gasoline for most of its fleet for the next year.
City Councilors voted April 27 to approve an agreement with Hill Petroleum, locking in the price for the next 12 months or 190,000 gallons of gasoline. The city typically purchases about 220,000 gallons of gasoline each year.
The deal includes a $2.25 rate for 95,000 gallons of diesel fuel. The city typically purchases about 120,000 gallons of diesel fuel each year.
“The city is working really hard to save money, and you know that gasoline prices are really low,” Chief Financial Officer Larry Dorr said. “We use a lot of fuel, so we are doing the work to lock in our fuel prices.”
Councilors passed the agreement as a part of the consent agenda at their April 27 meeting.
“Think of the fleet of police cars and fire trucks we have. We are going to have to use those,” Dorr said. “We know how much fuel we consume, so we can lock in prices with our wholesaler and they can go in and lock in their prices, too.”
According to the U.S. Department of Energy, regular gasoline prices in Colorado have been trending down since December when the price per gallon topped out at $2.82. It had dropped to $2.24 per gallon on March 23. A day later, the City of Denver issued it’s initial stay at home order.
Since then, the price has declined another $0.43 per gallon, reaching an average of $1.81 on April 27.
Diesel fuel prices in Colorado have followed a similar trajectory, starting at $3.24 in December and dropping to $2.43 per gallon on April 27 —a drop of $0.81 per gallon.
Westminster’s deal locks in a price of $2 per gallon for regular gasoline and $2.25 for diesel for the next 12 months.
“When you buy that much, it gives you the ability to enter into a futures contract,” he said. “When you buy as much as we do annually, you can enter into a futures contract to buy a certain amount — much more than any of us would buy on our own. We think we can save a couple $100,000 on this.”
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