Fuel price risk management

Take control of your fuel costs and secure your supply.

Fuel price risk management

Fuel costs can consume as much as 40% of an organization’s operating expenses. Prices vary daily, and each price hike has a profound impact on your budget. Trying to stay on top of the volatile fuel markets in-house can consume considerable time and resources. World Kinect’s fuel price risk management solutions let you tap into the knowledge of an expert team, save time, and reduce your price-related risks.

With the buying power and market knowledge of a Fortune 100 energy company, we’re able to help simplify your approach to fuel risk management. Our experts meet with you to understand your business and assess your financial and physical risks. Then we’ll create a customized fuel price hedging plan that fits your needs and risk tolerance. Every customer solution is different, but in every case, we aim to help you:

Meet your budget or achieve a margin.
Achieve cost certainty.
Secure your fuel supply.

As a World Kinect customer, you’ll have ongoing access to expert advice and thought leadership to help ensure your strategy continues to meet your needs as your business grows and changes. These updates are limited to World Kinect customers, but you can access our most recent market update <insert link> by completing a short form.

Budget certainty

Don’t gamble with daily market prices. You can protect against price volatility and also gain Don’t gamble with daily market prices. You can protect against price volatility and also gain
some certainty over your monthly fuel budget.some certainty over your monthly fuel budget.

Budget certainty

Stakeholder alignment

Get help reaching a consensus around your risk objectives. We’ll bring your stakeholders together and review the different risk management tools available. Then we’ll help you develop a clear plan forward that makes sense across your organization.

Stakeholder alignment

Reliable supply

Make sure your business has the fuel it needs. Our extensive supply chain and partner network mean we can deliver even when supplies get tight.

Reliable supply

Make sure your business has the fuel it needs. Our extensive supply chain and partner network mean we can deliver even when supplies get tight.

Actionable insights

Focus on your core business. Let our experts manage your fuel portfolio, stay on top of key price drivers and provide ongoing market intelligence.

Actionable insights

Focus on your core business. Let our experts manage your fuel portfolio, stay on top of key price drivers and provide ongoing market intelligence.

Organizational Needs

Could fuel price risk management help your organization?

It may be time to investigate fuel price risk management solutions if you:

Need to manage fuel budget to spend, achieve an average price or protect a minimum margin.
Buy fuel based on daily rack prices.
Spend countless hours calling suppliers to find the best price.
Lose sleep worrying about where fuel prices are headed.
Are not able to pass on fuel price rises to your customers.
Could benefit from continuous and informed market insight and analysis
Are wondering how to take advantage of fluctuating fuel prices

Candidacy

Is your organization a good candidate for fuel price risk management services?

When deciding whether a risk management strategy for fuel prices could help you, consider
how much fuel your organization consumes annually. Businesses that use one million gallons or
more will often receive the largest benefits from fuel price hedging. This includes companies in
industries like:

Agriculture
Construction
Manufacturing
Municipalities
Public sector
School districts
Transit authorities
Transportation

Additionally, fuel wholesalers can partner with World Kinect to provide fuel price risk management solutions to their customers

Unsure if fuel price risk management could help you?

Managing your fuel risks can be complicated. Reach out to us and we’ll help you evaluate your current fuel use, model potential solutions, and help you make the best choice for your business.

REQUEST A CALL

Why partner with World Kinect?

Understanding and evaluating the different types of risk management options can be overwhelming for companies that normally buy fuel based on the daily rack price. Our energy experts have extensive fuel experience and can help simplify the process. You’ll get a plan that meets your specific needs and a partner with:

Proven market experience. We have decades of expertise in implementing managed risk
approaches for diesel, gasoline and jet fuels that deliver tangible results.
A full-service partner. With World Kinect, you get far more than fuel price risk
management. You also get the support of a team that works with 160,000 customers
worldwide, delivering 50 million gallons of fuel every day.
Customer focus. We work collaboratively to offer flexible buying options that meet your
specific business and budget objectives.
Tailored solutions. Our fully flexible and customized buying options are designed to
manage your physical and financial risks. We’ll work with you to devise strategies that will help you achieve your KPIs

Josh Metcalf

District Manager, Waste Connections, Washington, USA

“World Kinect has given us all the information we needed to know and better understand the hedge process, in order for us to make the best decision. Our company consumes 4.2M gallons of fuel on an annual basis. And the information that World Kinect has provided allowed us to mitigate the inherent risks associated with what is one of our largest expenses.”

Fixed price model

Lock a percentage of your fuel consumption at a fixed price from Day 1.

Pros:

Achieve absolute budget certainty on your fixed fuel volume.
Know your exact commodity costs for the duration of your contract.
Gain fuel supply security.

Cons:

If commodity prices fall, you could pay more than the current open market rate.

Best if your company:

Has a low tolerance for unexpected price changes and supply disruption.
Requires a high degree of budget predictability.
Wants to maintain a set commodity expenditure.

Portfolio model

Leverage market volatility to your benefit with a mix of pricing tools (spot price, indexed price, fixed price or contracted volume)

Pros:

Flexibility to take advantage of market falls.
Achieve some degree of budget certainty for a portion of commodity demand.
Set a contracted volume.
Gain fuel supply security

Cons:

Requires adequate ongoing bandwidth to manage commodity pricing as the market
moves.

Best if your company:

Has fluctuating fuel demand
Wants to lessen market risk while still retaining some flexibility

*These materials are neither advice or recommendations of any kind with respect to matters herein, nor should they be construed as an offer, solicitation or statement of intent, are being provided without any warranties of accuracy, use or fitness for any purpose, and are not an offer to buy or sell in any jurisdiction to any person or entity to whom it is unlawful to make such an offer or solicitation.

Need more assistance with your energy budget?

World Kinect offers a full array of additional services that can help you meet your organization’s energy needs, including:

Ready to get your fuel costs under control?

Get in touch with us today.

REQUEST A CALL

Fuel price risk management

Take control of your fuel costs and secure your supply.