First Fuel Bank

[Sombeech]

This is an interesting concept. Here is a company located in MN. If you fear rising fuel prices, you can "buy in" right now at the current price, and fuel up later when prices are higher.


http://www2.firstfuelbank.com/

I'm not sure how they make their money though. Maybe if prices go down, and people are locked in at the higher rates?

[derstuka]

I'm not sure how they make their money though. Maybe if prices go down, and people are locked in at the higher rates?

Exactly, that is how they make their money. They have had these in Texas (and a few other states) for several years now. If you can front several grand to buy the gas up front, it might be a worthwhile investment, UNLESS fuel costs go down from what you bought it at.

[icthys]

Do you have to buy through them when the prices go down? or can you just pay cash? Then when prices go up buy with them.

[savanna3313]

They probably take your money and invest in oil futures.



This isn't a big company (in other words, they don't do their own drilling, capture and manufacture) so most likely they are buying from one of the big boys, but in huge bulk quantity, therefore discounted prices. When I was a dealer for Shell Oil Co back in New Orleans, 3 different companies pulled their loads from one bulk plant supplier. Exxon, Shell and Tenneco (the "cheap" gas). One bulk plant, same gas, different oil companies, varied prices on the street. Go figure.

While I am not a fan of these high gas prices, it's better than dealing with a gas shortage. People are having to self regulate. I worked for my Dad during the first gas shortage, and had my own location during the second one. Fist fights broke out and people tried to bribe me on a daily basis to let them come in after we were shut down (there was a $25K Federal fine if you got caught doing such!) We had a certain allocated amount we could sell each day, and we were usually out of our allotment within 3 hours of opening. The rest of the day, the business sat idle with no ancillary services being sold. People think that the Dealer (owner) cleans up when prices are high. This is a huge misconception. Whether you are paying $2 a gallon or $3 a gallon, odds are, the Dealer's pool margin (averaging of prices for all product sold) stays the same. Unfortunately, the Dealer will suffer financial loss because of the high gas prices. All other sales in his location will drop because people can't afford the $6 wash on top of a $45 fill-up. These types of services along with the convenience store, make up what their actual salaries are. Gas profit basically pays for overhead and that's it.

So, in other words, be nice to your local gas station owner. He/She can't help the high prices and gets VERY tired of being bitched out all day long for something that is being their control.

[derstuka]

People are having to self regulate.

I wish this were true Savanna, however, I haven't witnessed any of it personally. I still have people flying by me doing 85 in anything from a Civic to a lifted F250.

People think that the Dealer (owner) cleans up when prices are high. This is a huge misconception. Whether you are paying $2 a gallon or $3 a gallon, odds are, the Dealer's pool margin (averaging of prices for all product sold) stays the same. Unfortunately, the Dealer will suffer financial loss because of the high gas prices. All other sales in his location will drop because people can't afford the $6 wash on top of a $45 fill-up. These types of services along with the convenience store, make up what their actual salaries are. Gas profit basically pays for overhead and that's it.

So, in other words, be nice to your local gas station owner. He/She can't help the high prices and gets VERY tired of being bitched out all day long for something that is being their control.

Oh, I hope you weren't speaking of me young lady. I never blame it on the gas station owner(s). I usually blame, OPEC (and how they manipulate the market), the rest of the oil industry, capitalism, lack of new refineries (and capacity), American wastefulness, and greed, for the high cost of gas. Honestly, the only feasible way that I see for your everyday Joe to get back at OPEC, and the oil industry, and the big business that supports them, is to buy less of their product. Whether that means buying a more fuel efficient car, consolidating trips to the store(or wherever), riding your bike more often, walking, or, driving slower, and maintaining your car (i.e., changing air filter, spark plugs, checking tire pressure). Right now, we are at their mercy. I swear, as SOON as the price goes down, people start buying big cars again. This lady at work (is not rich by any means) just bought a Chrysler Charger with a HEMI, and I heard her complaining about gas prices at lunch.

[savanna3313]

What I meant by self-regulating, is that when prices get high enough, there won't be the need to worry about a gas shortage because people just won't be able to afford to drive in the same capacity in which they are accustomed. But, gas shortages are always temporary anyway, and once they occur and are over, immediately there is all the gas supply in the world available again. Politics and more politics.

As for the oil companies posting the profits they are right now, you would think that they would almost be afraid and/or ashamed to post that $9 B profit for the first quarter while raising prices to the consumer on what seems like a daily occurance.

It's good to know you seem to have an intelligent grasp of the situation.

[derstuka]

What I meant by self-regulating, is that when prices get high enough, there won't be the need to worry about a gas shortage because people just won't be able to afford to drive in the same capacity in which they are accustomed.

I know, I keep thinking of that, however, what price do you think that it will finally start having a drastic effect? I mean, I/we used to think that 2.00 or 2.50 a gallon was expensive, now most of us would kill for those prices! We get accustomed to getting screwed, then we start to think it is normal, or at least, bearable. Ya know what I mean? Years ago I used to think that breaking 3.00 would have a big effect, now I am almost thinking it will have to go to 5.00 or so, before people start making "very" drastic changes to compensate for the price.

[savanna3313]

What I meant by self-regulating, is that when prices get high enough, there won't be the need to worry about a gas shortage because people just won't be able to afford to drive in the same capacity in which they are accustomed.

I know, I keep thinking of that, however, what price do you think that it will finally start having a drastic effect? I mean, I/we used to think that 2.00 or 2.50 a gallon was expensive, now most of us would kill for those prices! We get accustomed to getting screwed, then we start to think it is normal, or at least, bearable. Ya know what I mean? Years ago I used to think that breaking 3.00 would have a big effect, now I am almost thinking it will have to go to 5.00 or so, before people start making "very" drastic changes to compensate for the price.

Interesting question. I guess it all depends on a person's income and need (for work, etc.) I think we're already seeing fuel charges passed on at the consumer levels already. Last time I went grocery shopping, I noticed higher prices. My brother in law has to fly for his business, and his ticket prices have almost doubled in the last 6 weeks. Higher prices are going to have a supreme domino effect on all of us. Then again, I have a friend that visits from England about once a year, and basically tells me how cheaply we all live here compared to anywhere else in the world. So, I guess compared to Europe and elsewhere, we have no reason to bitch.

[derstuka]

Interesting question. I guess it all depends on a person's income and need (for work, etc.) I think we're already seeing fuel charges passed on at the consumer levels already. Last time I went grocery shopping, I noticed higher prices. My brother in law has to fly for his business, and his ticket prices have almost doubled in the last 6 weeks. Higher prices are going to have a supreme domino effect on all of us. Then again, I have a friend that visits from England about once a year, and basically tells me how cheaply we all live here compared to anywhere else in the world. So, I guess compared to Europe and elsewhere, we have no reason to bitch.

Yeah, those Euros are always saying that we have it good! Look at their mass transit, and cars compared to ours though. They all either drive Mr Bean cars (was a show on TV with Rowan Atkinson) or motorcycles to offset the high fuel costs. I would take mass transit if I could, but it sucks here in San Diego. You pretty much need a car unless you work downtown and live near our "limited" Trolley System. I need to find a nice XL650 (motorcycle) to drive to work.

[accadacca]

Yup, yup! I have been driving my motorcycles to work getting 45-50 mpg. Then my wife drives our car (prius) and gets 50 mpg. We are combating the prices pretty well. However, I had to pay a hefty fee to get my BMW motorcycle. Just don't explain things to my wife....remember it was bought to save gas.

[rockgremlin]

I had to pay a hefty fee to get my BMW motorcycle. Just don't explain things to my wife....remember it was bought to save gas.

What kind of fee? Did you buy it new?