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For any of you who might know;
When the owner is storing Avgas at the local FBO, do they bear the price exposure for swings in the market prices of the fuel they have in inventory, up or down? Or does the supplier (e.g. Texaco, P66) provide a hedge for the fuel in inventory. E.g. let's say you buy 1000 gallons at $4 / gallon, and it took you two months to sell that off, over time the wholesale price of fuel increased to let's say $5.50. Did you just make money by being able to charge more for that slug of fuel sitting underground? And vice-versa -- losing money as prices come down (as they have just a bit now). Or does your supplier provide price protection. E.g. by shorting some futures that are correlated to the price of gasoline, then passing on the hedge insurance to you. Now, wrong group, but just in case anybody knows, what is the typical practice for the same question at the typical auto fuel stations (car, not plane, just to be clear)? Does the owner bear exposure to price swings for fuel that is in inventory? T |
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