According to AAA, the average regular gas price in the U.S. is $3.592 per gallon as of June 13. After falling for much of the second half of 2022, consumers are witnessing higher fuel prices this year due to increased demand and tighter supplies. Saudi Arabia also announced that it would begin cutting oil production by 1 million barrels per day in July to support the “stability and balance of oil markets.” This latest news is expected to increase prices over the travel season. And sadly, another trend that is increasing gas prices is fuel theft, with organized rings stealing enormous amounts of fuel.

Crime Ring Steals Fuel over Eight-Month Long Period

Eight people were arrested and charged last month with being part of a large-scale fuel theft network that stole more than 100,000 gallons of fuel from service stations in the Houston area. Between February 2022 and October 2022, local officials believe that up to 16 suspects are responsible for more than 60 incidents of fuel theft.
The suspects used a technique known as pulsar tampering, which involves manipulating fuel pump systems that measure how much fuel is being dispensed. A device is connected to the fuel pump to keep the fuel flowing while charging only a fraction of what was pumped. Crimes like this affect more than the gas station from which they are stealing, and we all end up paying more at the pump.

Real-Time Data Visibility & Detection

As the single largest expense fuel retailers and convenience store operators manage, every operator has a process in place to manage their fuel inventory. Surprisingly, many still manage fuel inventory and reporting using labor-intensive spreadsheets or outdated technologies incapable of monitoring real-time inventory fluctuations and eliminating sources of loss.

With a comprehensive data analytics platform, stakeholders can collaborate more effectively to understand anomalies. It is about gathering information together and then sharing those insights with personnel to examine operations with precision. Furthermore, a data analytics platform permits monitoring of locations remotely and at scale. Companies can monitor key systems from afar, ensuring that equipment is operating properly, and remain on top of exceptions.

Traditional back-office systems simply cannot keep up with daily reconciliation, especially for most accounting team’s typical 4-to-7-day audit time and high-loss threshold. Additionally, it is tough for a remote account team that isn’t actively running the business to determine whether dispensers are being used at unusual hours or if data from the tank system matches the pump record.

With an intelligent analytics solution, every fuel touchpoint including terminal to hauler, hauler to tank, tank storage, and dispenser to customer vehicle, can be reconciled in real time making it easier to quickly identify the root cause of an issue and recommend immediate resolutions.

As thieves are becoming more sophisticated and employing technology to evade discovery, they are counting on you to carry on as usual while they steal fuel covertly. However, if operators had access to the right software technology, scenarios like the one in Houston would have been identified quickly and not allowed to persist for eight long months.

Account for Every Drop with Frictionless Fuel Management

The advantages of the right software platform extend beyond data insights for fuel theft detection. Convenience store owners and operators utilize Titan Cloud’s Frictionless Fueling software to gain real-time visibility into their tanks’ inventory levels as well as to track other deviations across tank charts, meters, deliveries, temperature, and leaks. What’s more, Frictionless Fueling significantly enhances the customer fueling experience by identifying and preventing fuel issues like sluggish flow, nozzle unavailability, or tank shutdowns to have a real impact on the bottom line.

Operators rely on Titan to have total insight over all fuel movements, allowing them to make informed, proactive fueling decisions to track every drop of fuel purchased, stored, and sold.

Frictionless Fueling’s powerful benefits include:

• Detecting and responding to usage and demand changes in real-time
• Avoiding run-outs and overfills
• Optimizing operator and carrier management
• Identifying priority issues automatically with rapid first-time resolution
• Lowering overhead with true just-in-time inventory management

According to one Titan customer, after implementing Frictionless Fueling, they significantly reduced inventory variance, lowered acceptable delivery variances by 60%, and increased fuel sales by .5% per site.

Getting Ahead of Fuel Theft

As fuel theft is pervasive throughout the oil and gas sector, it is critical to adopt a comprehensive strategy to quickly uncover and address any issues in near real-time. While criminals will navigate new ways to evade security measures, focusing on the fundamentals will help operators stay ahead of criminal activities. Companies will benefit from hardening core infrastructure, real-time data, and purpose-built software to gain a deeper understanding of the problem.

In this eBook, get detailed tactics you can implement now to stop fuel theft before it becomes a major problem for your business, as well as:

• Trends every fuel facility should be aware of
• Building a more granular accounting picture to understand your fuel inventory
• Educating and training your staff to be safe and prepared
• Best practices to implement a data analytics platform, and more…

Download the eBook

With fuel theft on the rise, companies need to take precautionary measures. The biggest challenge to navigate is the unpredictable nature of crime — it’s impossible to know what illicit actors are thinking and planning. After all, they’re working actively to outsmart protective best practices. It’s an issue that’s endemic and timeless to the industry.

Solving the problem means hardening core infrastructure and implementing systems to overhaul operations. In this guide, you’ll learn actionable recommendations for how to identify and prevent fuel theft at your organization. This guide is particularly helpful for leadership at convenience stores and in the fleet space.

Gain perspective for how to stay ahead of theft issues before they have a chance to cause major problems in your business. Read the full report on fuel theft here. 

1. Implement a Digital Analytics System

Many convenience stores and trucking companies still manage their data using spreadsheets, hard files, and paper. With these systems, companies cannot perform analyses at the pace needed to pinpoint — and stop — sources of loss.

With a comprehensive digital analytics solution, stakeholders can work together more efficiently to understand anomalies. It’s about pulling information together and then sharing those insights with personnel to examine operations with precision.

One benefit to a digital analytics system is the ability to monitor sites without being physically present. From afar, companies can monitor electric systems, ensure that equipment is performing effectively, and stay on top of sensor alerts.

Are dispensers being accessed at odd hours? Does tank system data reflect what’s being reported at the pump?

For both convenience stores and fleets, operations are in nonstop motion. At gas stations,  people are constantly picking up nozzles to make purchases. On the road, truckers are laser-focused on safety and making stops when they need to rest.

Spreadsheets can’t move fast enough to keep up with this activity. While it may be possible to identify fuel loss or theft through manual processes, the effort required will be extensive. With an intelligent analytics system, it becomes easier to quickly identify the root cause of an issue — and recommend immediate resolutions.

2. Bridge Gaps with Vendors

Often, it’s a third-party company that’s responsible for managing a company’s fuel inventory. These vendors are well-aware of fuel theft; however, they are overseeing complex processes across multiple companies. Anomaly detection may be challenging given the lack of uniformity across systems.

For instance, Titan Cloud recently worked with a company that utilized six different approaches to retrieving information from data. It was a cumbersome and antiquated process. The company used Titan Cloud to install and manage equipment end-to-end.

Over the next year, the efficiencies gained translated into 1 million gallons of fuel savings for this company. The group was able to prevent loss — including theft — while establishing a stronger foundation for future analysis.

3. Prioritize Staff Education 

Most employees, especially truck drivers and customer-facing staff at convenience stores, are focused on doing a good job. The thought of fuel theft is unlikely to cross their minds until after an incident takes place.

That’s why it’s important for executive teams to keep staff in the loop. For convenience store managers, a few simple measures can help identify theft early on:

• Are certain customers taking unusually long periods of time at the pump but paying small bills?
• What protocols should staff follow after noticing suspicious activity?
• What are some warning signs for staff to watch?
• How can staff best stay in sync with news regarding local crime?

Similarly, transportation and logistics companies need to support their drivers. Verizon Connect recommends the following best practices for fleet managers:

• Ensure drivers are aware of the dangers of fuel theft
• Provide training regarding basic vehicle safety (i.e. after-hours parking, locking fuel caps)
• Install fences, lighting, and security cameras in vehicles and fuel yards as a deterrence
• Remind drivers to park their trucks in a way that blocks access to fuel tanks
• Help drivers identify the signs of suspicious activity

Above all, it’s important to establish protocols for staff to protect their safety. Where there is illicit activity, there is also the potential violence. In no situation should companies put their staff in danger. 

Final Thoughts

With fuel theft being endemic to the oil and gas industry, it’s important to take a bird’s eye approach to rooting out the problem from occurring in the first place. Fighting individual theft incidences and tactics can help — but ultimately, bad actors continually find new ways to outsmart security measures.

Staying ahead of illicit activity means focusing on the basics. Companies will benefit from hardening core infrastructure and gaining a deeper understanding into the problem.

Stranded business travelers. Airless buildings. Silenced elevators. Rush-hour chaos. From Detroit to Toronto to Manhattan and beyond, more than 50 million people across eight northeastern U.S. states and parts of Canada were without power. 

Millions lived again with uncertainty during the largest blackout in North American history almost 20 years ago. At the time, the suspicion was that the blackout represented a cyberattack on the U.S. power grid.

Thankfully, the cause was much more benign. A cascading series of events: human error, software issues, and equipment failures caused what the media called the Northeast Blackout.

But human suffering and business losses were significant

Make no mistake. The threat of cyberattacks is real. U.S. support of Ukraine as it wards off Russian aggression has invoked hostilities toward NATO and especially the United States, according to evolving intelligence.

As Putin’s military invasion of Ukraine wears on, his back is against the wall, said President Joe Biden. He recently warned of Russian cyberattacks against the U.S. Putin’s frustration grows as his suppression of Ukraine falters; some speculate that a cyberattack could be the next step.

Brian Harrell, a former assistant secretary for infrastructure protection at DHS, said “the most logical enemy avenue approach is through vulnerable 3rd parties and the critical supply chain.”

This points directly at critical infrastructure and the U.S. retail fuel supply. The threat to web-connected fuel tanks is no small matter.

Tank Monitors Susceptible to Cyber Risk

The vulnerability of the gauges used to monitor gasoline tanks is the latest security issue challenging industrial devices which are increasingly being connected to the Internet of Things (IoT). Automated tank gauges (ATGs) are used by nearly every fueling station in the United States and tens of thousands of systems internationally. 

While ATGs are typically accessed to monitor fuel inventories, attackers could easily alter the settings. Imagine if hackers concentrated their efforts to make changes to hundreds of systems simultaneously, locking out access which would lead to a host of problems.

Frequent run outs and loss of alarm notifications could result in ATG alarms being missed. A security breach on ATGs could raise issues with fuel compliance, fuel theft, and even terrorism.

Many independent operators connect to the Internet with an off-the-shelf home router and use a public IP address. They haven’t given much thought to security or firewall protection. Tank monitors that are connected remotely using public IP addresses are highly susceptible to cyberattacks. 

As a leader in data security, we factor security into every decision we make. From our IoT hardware to our Web platform, we strive to optimize security and minimize the risks associated with sensitive data. Here’s what we recommend to protect your convenience store operation.

5 Ways to Guard Against Cyberattacks

1. Close the system

Unlike the TCP/IP method of monitoring automatic tank gauges, which leaves multiple ports exposed to third parties for manipulation, the Titan cellular-based system is closed and entirely proprietary. It has no physical or digital “open ports” that expose a client’s network to potential unknown attack vectors.

2. Limit application access

Canary’s system is the only application running on our hardware, limiting the number of potential security holes from third parties. A site connected via TCP/IP can be connected to many applications, increasing risk exposure.

3. Encrypt communications

All communications between our device and the cloud are encrypted to ensure confidentiality; APIs are accessible only via HTTPS and use a 2048-bit TLS certificate.

4. Leverage trusted partners

We exclusively use best-in-class hosting via established and trusted hosting companies like Amazon Web Services, using ISO 27001, 27010, and 27018 physical security and risk management.

5. Manage user access and security

Canary employs strong password requirements, and access control lists to prevent users from controlling applications or devices that are not theirs.

Wrap Up

Being proactive and cyber aware is the first line of defense for every owner/operator connected to the Web. Using a secure, encrypted cell modem like a Canary box is a guaranteed way to eliminate the risk of a cyberattack to your network via your tank gauge by taking it off-network. 

While cybercriminals exist, you can protect yourself from rogue agents. You can limit the applications you use, manage user access, encrypt communications, and work with partners you trust.

What are you doing to ensure your ATG, a vulnerable network endpoint, is properly secured from increasing online threats to fueling infrastructure?

Learn more about Titan Cloud’s Canary today.

What do convenience store owners, fleet directors and bus terminal managers all have in common?

These are the folks who manage the fuel inventory for their company. Cars, trucks, and buses all need gas. As you know, there is plenty of risk and loss involved in managing a retail fuel supply. Poor fuel management can translate to less profit for the company which the company passes onto the customer.

Fuel is the number one expense for your facility. Fuel inventory variance adds a layer of complexity. You may be thinking, “How can a gallon of fuel change? A gallon is a gallon, right?”

Well, no.

Trust us when we say that there’s a lot of science behind fuel inventory variance. Suffice it to say that the volume calculation of fuel within its container represents an imperfect science. This results in reading errors. 

To make matters worse, many Fuel Directors (we’ve been told) still track their inventory the analog way with spreadsheets. Not only is this cumbersome but also represents a huge waste of time, energy, and money. If you transfer imperfect data to your accounting system on top of flawed fuel readings, then it will be impossible to determine the true cost of your company’s fuel inventory.

But wait, here are a few more surprises.

Other factors, like weather, theft, leaks, and global uncertainty all affect fuel supply.

Know the Importance of Fuel Inventory Variance 

1. How Weather Affects the Retail Fuel Supply

Americans from coast to coast saw or experienced many extreme weather events these past several months. From raging fires in the West to a standstill on I-95 that kept drivers snow-trapped overnight. Nashville, home to Titan Cloud Software, was immobilized for two days after six inches of heavy snow fell and below-freezing temperatures made a surprise appearance.

We don’t think about fuel supply until the demand exceeds it, and then we rush out to top off our tanks and fill our generators. But, what if your local retail fuel outlet didn’t plan ahead of the weather report? What if you bought a bus ticket to visit friends and the depot didn’t factor in weather conditions? What if your area loses power and the local electric or cable company didn’t gas up its fleet?

This is a potential worst-case scenario awaiting your business when you have no weather contingency plan that makes fuel inventory planning a priority.

On the flip side, fuel delivery during bad weather is often hampered. Does your fuel distributor have enough deliveries scheduled? How large is their fleet? Where are their distribution centers and who’s in their network of local distributors? Can they guarantee efficient fuel management? This is when custom automated workflows can become a lifesaver.

2. How Small Leaks Affect Fuel Supply

Leaks in your fuel storage tanks and containers impact more than the environment. Although rigorous compliance is reason enough to take charge of your fuel inventory, leaks also represent revenue loss.

Leakage won’t be found on your spreadsheets. Thanks to innovative technology there’s a way to analyze the changes in height and volume within the tank that allows for rapid and sensitive leak detection. Even tiny leaks can be spotted fast whereas in the past it would have taken days or weeks to solve the problem. When retail margins are slim, every drop matters.

3. What Faceless Fuel Theft Looks Like

Back in the 70s during the oil embargo, when gas was in short supply and car lines were long, it was common to read stories of thieves siphoning gas from a car parked in a homeowner’s driveway. Today, theft often happens in a less obvious way.

Vendors or carriers may “steal” through inaccuracies. Siphoning fuel this way happens through an inaccurate fuel drop. If you’re monitoring your automatic tank gauge (ATG), you should be able to catch this. Titan’s ATG management system will alert you to discrepancies between your tank amount and fuel sales.

We don’t want to sound alarmist. Fuel inventory variance could be inadvertent and no fault of the carrier. Because fuel is a liquid, it expands and contracts based on temperature. Liquid contracts when it’s cold, so the actual fuel delivery and the bill of lading may differ. A cold tanker could be the cause of the variance.

Below ground, the variance may happen for a different reason. Fuel can contract inside the tank when the outside temperature is warmer than the below-ground temperature. There would appear to be an inventory variance even though you received the right amount of fuel.

You can see why the technology protects both the retail fuel stop and the vendor.

4. How Global Uncertainty Shakes Things Up

High gas prices tend to have a ripple effect on consumers’ pockets and businesses’ profits. Gas prices in the U.S. typically increase in the Spring and then decrease in the Fall mainly because demand declines following the warm summer months. But, for the past several months, gas prices have been rising. 

The cost of crude oil worldwide is affecting gas prices at the pump and softening demand. The economics of low demand/high supply is off-kilter because the cost of crude oil accounts for more than half the price of a gallon of gas. Couple that with European natural gas prices going crazy due to the harsh words traded between Russia and the West and panic-buying hit the market sending prices through the roof. Demand for heating oil is also strong, allowing for crude oil prices to remain high.

As long as global uncertainty continues, fuel inventory planning is more important than ever.

Wrap Up

There are many ways convenience store owners and operators can lose money through fuel inventory variance. The good news is that technology exists that can improve your fuel planning. You can manage risk despite extreme weather events, global uncertainty, or fraudsters. 

Learn more about how Titan can perfect your retail fuel management.

To care about wetstock management is to care about saving—and making—money. If you buy or sell fuel, wetstock management is required to ensure that you receive and dispense the amount of fuel you paid for. Good wetstock management helps companies keep track of their fuel inventory so they can detect fuel losses when they occur and use their resources efficiently.  

Every fuel retailer has a process to manage fuel inventory, as fuel is by far the largest expense an operator incurs. As with other commonly used industry terms such as inventory management or inventory reconciliation, wetstock management is a global term that attempts to address all potential sources of variance including tanks charts, meters, deliveries, temperature, theft, and leaks. Technology can help.  

Many convenience store operators have a wetstock management process in place, but it comes in the form of massive spreadsheets and error-prone manual entries. Since most local regulators require accurate and timely fuel reports, automating your wetstock management process is vital for day-to-day forecourt operations. Without an accurate and dependable process using scalable technology, owners and operators are exposing themselves to enormous risk.  

Replacing manual wetstock management processes with an intelligent software solution (such as Titan Cloud’s Frictionless Fueling) gives c-store operators greater visibility into their fuel movements, so they can account for every drop of fuel purchased. Fuel management software minimizes inefficiencies caused by slow fuel dispensing, over dispensing, and shortages for a better customer experience and greater profits. After implementing Frictionless Fueling, one Titan customer found that they reduced inventory variance significantly, reduced acceptable delivery variances by 60%, and increased fuel sales by 3% per site. Focusing on wetstock management is a critical part of any convenience store’s path to greater profitability, so get started on improving your system right away.  

If you’re ready to improve your wetstock management, get in touch with our team.