7 Things You Don’t Know About Your Wholesale Fuel Rack Report
If you are reading this, chances are good that you have recently started subscribing to one of our rack services or are interested in doing so.
If so, welcome!
Chances are also good that you have many questions — and we don’t blame you. Navigating the wholesale fuel market can be confusing. But we’ve been covering rack markets for over 30 years, so we’ve got you covered.
In this post, we’ve gathered answers to some of our most frequently asked new subscriber questions to tell you seven things you don’t know about your wholesale fuel rack report, complete with detailed advice from our customer service experts. These insider tips will put you on the fast track to getting the most out of your subscription.
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Totally new to OPIS wholesale pricing? You should check out this How-To Guide for a step-by-step guide to reading your service.
1. What file format should I subscribe to?
We always recommend you speak to your jobber or supplier – or review your contract – to figure out the report you need. The basic things you will need to know are:
- The time of day (or timing) your jobber or supplier uses to calculate your costs. That way, you will know the timing best for you — closing, contract, 6-to-6, etc.
- The rack location your supplier is sourcing the product. Knowing this will clarify which rack cities are essential for you to reference.
- Whether your supplier passes on a prompt payment discount to you. A “gross” OPIS rack report shows prices without a prompt payment discount, while a “net” report will remove the discount.
Here’s another thing to remember if you track rack prices in markets with compliance costs based on carbon regulations or emissions caps. Suppliers have yet to come to a standard on how to pass along the cost of compliance. Here are a few things to note:
- OPIS rack reports include a daily Cap-at-the-Rack (CAR) assessment. This assessment is based on the compliance costs of cap-and-trade regulations on gasoline and diesel fuel regulations.
- OPIS reports also include a daily assessment of LCFS costs in markets with compliance costs associated with low carbon emissions programs.
- Some suppliers pass along the compliance costs embedded in the posted rack price, while others pass along the costs as a line item on invoices.
Because of the lack of standardization, OPIS “normalizes” prices with three options:
- Non-Adjusted: Reflects the prices posted by suppliers even when some suppliers include the CAR value in the posted price, while others pass the CAR on as a line item on invoices.
- Normalized, With CAR Cost: Adjusts the prices of suppliers who do not pass along the cost of compliance in their posted price by adding the OPIS assessed CAR and/or LCFS value or the suppliers’ own CAR and/or LCFS value. Note: The OPIS CAR and LCFS values are updated by the OPIS Spot Editors at the end of each day and published in The OPIS Carbon Markets Report.
- Normalized, Without CAR Cost: Adjusts suppliers’ prices who pass along the cost of compliance in their posted rack price by REMOVING the OPIS CAR and/or LCFS value from the suppliers’ posted price.
2. I know a supplier offers gasoline at my rack location, so why don’t I see their prices?
OPIS only lists wholesale rack prices for suppliers we have deemed “ratable,” meaning they have a consistent supply. There may be other wholesalers supplying a market who offer supply on a more sporadic basis. We carefully evaluate each new supplier so that you only see the ratable suppliers in our reports and benchmarks.
We offer the OPIS Bottom Line Report, which may show non-ratable or discounted deals below the OPIS-published “ Rack-Low.”
3. Why don’t I see the price change my supplier told me about?
Check the timing of your file. If you receive a closing file, for example, (delivering at 4:59 p.m. Eastern Time) and load your fuel that day, the price you pay will not include the 6:00 p.m. price changes for the same day, as they have yet to become effective.
Here’s a tip: If you are concerned about that, you may want to talk to your supplier and switch your “benchmark” cost basis to the next day’s 10:00 am “Contract Average”. This benchmark is available at 10:00 am Eastern Time, so if you are in the Midwest, it is available at 9:00 am, 8:00 am Mountain Time and 7:00 am Pacific Time. The OPIS Contract Benchmark is the gold standard and is used widely across the industry as the cost basis for many fuel purchasing contracts.
We offer additional rack services, including our “6-to-6” timing files, web-based rack pricing, and even an API that can help you track changes throughout the day in real time so even when daily fuel purchases are made on a benchmark referencing OPIS Rack Contract Benchmarks, you can see the market any time of day or night.
4. How does OPIS get its gasoline and diesel numbers?
Many suppliers provide rack prices directly to OPIS using the same pricing messages their customers receive. For others, prices are collected from buyers OPIS has vetted as reliable sources. OPIS almost always has multiple sources for each price; we place a lot of emphasis on the integrity of that data.
5. How do I know the data is accurate?
OPIS performs rigorous quality control to maintain data integrity. This includes automated processes using data science and AI and hands-on scrutiny by our rack pricing team, who work around the clock and around the globe. Our systems automatically flag prices that seem much lower or higher than the average or appear out-of-date. We also check data from multiple sources against one another to ensure they are consistent. Find out more about our methodology.
6. What are OPIS newsletter prices?
OPIS publishes a weekly newsletter with pricing broken down by Petroleum Administration for Defense District, or PADD. The OPIS newsletter has two “benchmark” rack prices: a snapshot of the rack at 5:59 p.m. Eastern Time on Thursday and a 5-day average that includes that Thursday and the previous four published days. OPIS “newsletter” prices — either the Thursday close or the 5-day average — are used primarily in legacy government fuel contracts.
7. In what ways can I digest OPIS rack data?
You have a myriad of choices! We offer an API, “readable” racks that deliver via email, and we have several “raw” data files that we can provide via email or FTP, allowing you to import the data into back-end billing and accounting systems. We also offer two web-based rack report products. OPIS Real Time Racks allows you to see price changes at the rack as they happen, while our WebRacks services allow you to log in multiple times a day to view key benchmarks (and always offers five days of price history as part of the subscription).
As a general rule, communication is key to your success. It is essential to work with your jobber or supplier — or review your contract — to figure out the data that you need. It’s critical that you communicate with your internal team to decide which format is most appropriate for you. And most importantly, OPIS is available around the clock to answer any questions you might have. As we say, we’ve been doing this for over 30 years. We pride ourselves on listening deeply to our customers and continuing to learn from them, so feel free to call and stump us! We’ll make it our mission to get you the exact answer you need.