Why don’t oil companies and/or gas stations offer pre-paid gas at a fixed price. Say Shell offeredto sell a thousand gallons at $4 (or whatever number), which I could take any time at a Shell station.
The way it would work is that by letting gas companies lock in their sales, they can hedge the gas price, i.e. lock it in for the consumer at that point. It is simiply having the gas company buy a bunch of gas for me now, versus over time.
Or even a thrid party could offer it, I suppose, simply by hedging their risk. Am I crazy?
You mean like First Fuel Bank? They already exist. When my grandparents still went roadtripping in summers their Christmas gift was always ~$250 of gas.
The thing about gas is…you have to buy it. The only thing that makes a difference is where you buy it. Now, if one company did that, they all would sooner or later, and then it wouldn’t matter anymore. Doing something like this is useful to say, a bank offering a CD. If I have a bunch of money sitting in a savings accoung, I don’t HAVE keep it at that bank or any bank for that matter. But if a bank offers me a great rate on a CD I might be more willing to lock it in for a year or more.
See without being locked in, the bank never knows when I’m going to take my money and leave. Like I said, I don’t have to keep it in a bank. Gas on the other hand, well , you’ll always need gas and they would rather sell it to you at ever increasing prices.
Many farms get this service. Here, Shell and Co-Op drive their nice big gas trucks out to your farm and will fill your gas tank for you in bulk. Man, I remember we used to just stick a padlock on it. Of course, that was when gas was 0.50 a litre, not the 1.37 it is now.
That’s different. That’s buying that gas outright. What the OP is basically suggesting is that you buy say 1000 gallons at a given price and they hold it for you until you need it. It’s a small contract.
Sometimes, you can contract with a supplier (often a co-op) for a year’s worth of gas at a specific price. Then it is delivered to your farm as needed during the year, and you pay the agreed-upon price. Usually there is a minimum amount you must buy over the year, and sometimes there are various prices, depending on the total amount you actually buy over the year.