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Oil Prices & Your Parking Lot
Record Prices
Due to the current volatility of the petroleum industry, incremental increases in the price of asphalt paving mixtures are expected throughout 2007 with no pricing guarantee for the future.
Soaring prices have been driven by increased crude oil pricing. Current pricing is near $90 per barrel. For more information, please click on the "crude oil futures price" link on the right.
Compounding rising material costs are skyrocketing fuel and natural gas costs, both of which impact pricing on asphalt projects. Raw materials, aggregates (stone and sand), and liquid asphalt require transportation from plants to job sites. In addition, it costs more for the BTUs (British Thermal Units) required to dry the stone and heat the asphalt to 350 degrees Fahrenheit.
Also, amidst all the concern over rising oil prices, be aware that some paving companies may experience material shortages at any given time throughout the year. Fortunately, because of the sheer volume of projects we complete, Rose Paving is in no danger of encountering such shortages.
Maintenance Recommendations
With all this unsettling news, what can you do? The best advice is to remain diligent in maintaining your asphalt investment. Do not postpone maintenance because of increasing costs; it will only be more expensive to repair a deteriorated parking lot later on.
Be advised that signing contracts promptly is more important than ever before. Historically, there have been time limits on the validity of material bids. Industry standard used to be 90-150 days; however, that is no longer true.* Additionally, it is advisable to increase funds in capital expenditure budgets by about 20%. Increasing these funds is important because reputable contractors will not be able to absorb price increases.
To evaluate the fairness and value of a contractor's bid, you also need to compare applications. Be clear on a contractor’s terminology and the details of what work will be performed. For more information on selecting a contractor and quality control, click here.
Sign Contracts Now & Save
Material and energy increases will take effect on proposals in early spring of 2008. If you are unsure of maintenance needs or alternatives unique to your property, please contact us today toll-free at 888-773-7673 or email .
*Please note: Effective immediately, due to the instability and drastic raw material fluctuation in asphalt, all Rose Paving proposals are only valid for 15 days from the date quoted.
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