5 Things to Consider When Buying Fuel in Bulk From a Wholesale Diesel Fuel Supplier

Fuel is the largest expense for companies, countries, and individuals. Studies show that the total gasoline consumption comprised 58% of the total transportation sector consumption, 17% of the total U.S. energy consumption, and 45% of total petroleum consumption in 2019. Since fuel prices are extremely volatile, companies continue to look for ways to keep the costs low. Buying fuel in bulk from a wholesale diesel fuel supplier seems the most effective fuel management practice, especially for companies with fleets of cars. Bulk purchases save time and money, as employees no longer need to wait in queues or handle fuel cards. However, not all companies can benefit from buying wholesale fuels in the same ways. Let’s look at what a company should consider when switching from retail to bulk fuel delivery.

Assess Your Fuel Needs

Your fuel requirements depend on several factors. These include the number of equipment and vehicles, the size of the fuel tanks, and if the company uses the fuel as it’s delivered. Wholesale diesel fuel, for example, contains a percentage of biofuel, which can develop problems if stored for long. Some fuels develop microbes that contaminate the fuel, damaging the fuel system components. Assessing your fuel requirements should help you decide if you should buy wholesale fuel.

Consider the Storage Life of the Fuel

Fleet managers should also assess the storage life of the fuel because they are formulated to tolerate specific seasonal conditions. If the conditions change, the fuel deteriorates and gets old. Using such fuel increases the equipment’s servicing costs and reduces engine efficiency.

Setting a reasonable limit when buying fuel from a wholesale diesel fuel supplier is critical to keeping your equipment operational for a long time. For some companies, it means buying the amount of fuel that they can sell while it remains fresh.

According to research, diesel fuel stays fresh for 12 months or longer at a temperature of 20 degrees celsius and six to 12 months at temperatures higher than 30 degrees celsius. Once diesel ages, gum and fine sediment form in the fuel due to diesel reaction with oxygen.

Selling such aged oil blocks fuel filters leading to engine problems and fuel starvation. Maintenance costs also increase due to frequent filter changes.

Establish a Purchase Network

It’s challenging to control fuel costs when drivers purchase fuel from anybody. Establishing a purchase network ensures you buy bulk fuels at the lowest price and negotiate more discounts. The network should have primary stops located 200 to 800 miles.

The industry standard is 400 miles of separation, but some carriers prefer 200 miles to ensure ample nationwide coverage. The success for the purchase network largely relies on your drivers. Inform them about the different locations of the wholesale gasoline provider and that they are expected to make stops at them.

Ability to Maintain Fuel Quality

Fuel quality determines engine efficiency and engine life; the problem is more evident when buying wholesale fuels. Water and dust are the main elements that affect fuel quality, hence the need to set up technologies that keep them at bay.

As the temperature drops, the crystals get bigger, and if diesel is sold in this state, it blocks the oil filters. Fleet managers should assess their ability to integrate technologies that enhance continuous tank filtration, on-vehicle filtration, and filtration at the delivery point to eliminate such effects.

Sign a Bulk Fuel Contract and Review it Periodically

When buying fuel in bulk, it’s important to sign a contract with the wholesale diesel fuel supplier. It protects you from price fluctuations and guarantees a constant supply of fuel. The supplier should also make a provision to review the contract because the fuel market is incredibly volatile.

For example, high prices may cause manufacturers to overproduce oil, which can lead to a fluctuation in prices. If a company had signed a contract to buy fuel in bulk when the prices were high, it should review the contract to take advantage of the low prices.

Buying fuel in bulk from a wholesale diesel fuel supplier is not just about saving on costs. Companies should perform a thorough analysis to determine their fuel needs and ability to store and maintain fuel quality.