{"id":47496,"date":"2025-09-26T16:10:58","date_gmt":"2025-09-26T16:10:58","guid":{"rendered":"https:\/\/www.spragueenergy.com\/?p=47496"},"modified":"2025-10-31T12:34:16","modified_gmt":"2025-10-31T12:34:16","slug":"protect-your-business-from-volatility-with-oil-and-gasoline-forwards","status":"publish","type":"post","link":"https:\/\/www.spragueenergy.com\/fr\/protect-your-business-from-volatility-with-oil-and-gasoline-forwards\/","title":{"rendered":"Protect Your Business from Volatility with Oil and Gasoline Forwards\u00a0"},"content":{"rendered":"
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Energy markets are constantly shifting. Seasonal demand, global supply, and unpredictable weather can all cause prices to spike. For businesses that depend on heating oil, diesel, or gasoline, this volatility can create real budget challenges. One solution is oil and gasoline forwards<\/a>, a strategy to help protect both your supply and your bottom line. <\/p>\n<\/div>\n\n\n\n

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What Are Oil and Gasoline Forwards?<\/strong> 
Oil and gasoline forwards are a financial instrument that allows you to lock in a fuel price today for delivery in the future. Instead of waiting to see where the market will be, you secure your price in advance. When the time comes, your fuel is sold at the contracted rate. <\/p>\n\n\n\n

Whether you lock in all of your supply or just a portion, a forward strategy can protect you from market volatility. By planning ahead, you gain control over costs and eliminate the stress of purchases during peak demand. <\/p>\n\n\n\n

How Oil and Gasoline Forwards Work<\/strong> 
Let\u2019s say you are a property manager that owns several apartment buildings that use heating oil. Rather than waiting until winter to purchase, you agree in September on a fixed price and delivery schedule with your supplier. When January arrives, your fuel is delivered at the rate you locked in \u2014 even if the market has gone up. The same scenario applies to companies that supply heating oil to residential properties. The procurement manager of a heating oil delivery company can also lock in their rate ahead of the season to ensure budget certainty regardless of the sways of the market.\u202f <\/p>\n\n\n\n

This strategy is not reserved for winter, though. You can apply this same strategy to any season. For example, if your company needs diesel in the summer, you can create a forward contact for that need as well. Contracts can be customized to fit your needs.\u202f <\/p>\n\n\n\n

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These types of forward contracts can apply to heating oil, diesel, gasoline, kerosene, biofuels, blended fuels, etc. The structure is flexible. Contracts are designed around how much fuel you need, when you\u2019ll need it, and which product best fits your operations. <\/p>\n\n\n\n

Market volatility by nature moves both up and down. So, while a forward contract locks in your price, another option to consider is downside protection. When opting for forward programs, check with your supplier to see if there are ways to cover yourself if the market falls. For instance, Sprague offers its customers a downside protection<\/a> product in the event that the market goes below your locked-in price.\u202f <\/p>\n\n\n\n

Why Businesses Use Forwards<\/strong> 
Consider a business that contracts in September for 50,000 gallons of diesel at $3.10 per gallon for delivery from January through March. By February, the market climbs to $3.50. Thanks to the forward, the business still pays $3.10, saving $0.40 per gallon. On 50,000 gallons, that adds up to $20,000 in savings. <\/p>\n\n\n\n

A forward contact can give you: <\/p>\n\n\n\n