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HOT FUEL: A HIDDEN RIP OFF OF AMERICAN CONSUMERS, BUT ALSO A SAFETY RISK

Each year, as the temperatures rise around the country, a phenomenon known as “Hot Fuel” emerges in the United States. Gasoline products are sold to retailers at what is known as the 60 degree “net fuel” volume. Pricing is based on gallons of gasoline at the industry standard temperature of 60 degrees Fahrenheit. Gasoline volume expands at temperatures in excess of 60 degrees. So, each summer, retailers receive a gross or actual volume of gasoline significantly greater than they pay for. At the pump, retailers have a built in profit each summer as their volume expands while their overhead does not. In fact, they tend to raise prices each summer thereby further enhancing their profits.

This has been the subject of congressional investigation and a class action lawsuit, claiming unjust enrichment by gasoline retailers. Consumers have been in the dark about this hidden cost of gasoline. What’s worse, due to heat expansion, the volume of gasoline increases, but the fuel efficiency does not. The consumer pays for the heat expanded volume of gasoline, but only receives the fuel efficiency of the net volume. A full tank in the summer gets the consumer fewer miles down the road than a full tank in the winter months. The consumer class action relating to hot fuel recently settled. For an article on the story, click here.

But the hot fuel issue is also a safety issue. When gasoline station owners account only for the fuel they purchase, in other words the “net fuel,” they omit from their inventory thousands of gallons of gasoline throughout the summer months. If they lack reliable, electronic tank gauges they risk under- accounting for their inventory on a massive scale. This is a recipe for catastrophe as an overflow of petroleum, especially from an above ground storage tank, is an instant fire hazard and risks a probable explosion of great magnitude. So, this summer, be mindful of what you are paying for gasoline, but also consider keeping your distance when that tanker truck rolls up to unload a delivery of hot fuel.