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 Surprisingly, many still manage fuel inventory and reporting using labor-intensive spreadsheets or outdated technologies incapable of monitoring real-time inventory fluctuations and eliminating sources of loss.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

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.

by Kurt Gutzmann, Chief Scientist

What exactly is a “tank chart” and why do we want it to be “perfect”?  A tank chart tells us how much liquid is in a tank based on the height of the liquid. It sounds simple. Tanks might be cylindrical, or they might be ‘capsules’, cylinders with hemispherical end caps (see Figure 1). Still, there are some formulas from analytical geometry that will give us the volume of liquid for a given. The tank might be tilted a bit, perhaps 1 inch (25 mm) from one end to the other, so the liquid will pool at one end as it gets low. 

Figure 1. Ideal Tilted Cylinder 

This problem was solved over 350 years ago when Euclidean geometry met Newton and Leibniz calculus. However, the “solution” makes the very big assumption that our tank is “perfect”, i.e. it is well and truly a cylinder. The reality is the tank only looks like a cylinder at a coarse level of resolution. If we zoom in on the tank, we will find all kinds of irregularities, deformations, and internal volume-occupying structures (gussets, pipes, pumps, welds, and more). These cause the tank’s shape to depart significantly from the ‘ideal cylinder’ or ‘ideal capsule’. So, the volume calculation above will produce errors by overstating the volume here and understating it elsewhere in an unknown manner. 

Is the calculation good enough? That depends on what we are doing with the volume. For bookkeeping purposes, it might be sufficient. For measuring how much fuel we just received in a delivery, it might be close (+/- 3%) but probably not. For leak detection, it is not nearly good enough. For precision and accuracy of inventory variance for environmental compliance purposes (+/- 1% US, +/-0.5% Canada) the calculation will fail most of the time. 

If we have a more perfect calculation, one that accurately and precisely (see Figure 2) gives us volume from height, we can use that ‘perfect tank chart’ with confidence that the numbers are correct.

Figure 2. Precision and Accuracy 

So how do we get such a perfect chart? One way might be to pour known amounts of liquid into the tank, check the height, and record it as we gradually fill the tank. This might get us some accuracy, but if we want precision, we will have to use little tiny amounts at a time which is not feasible. The tank manufacturer uses this procedure to ‘calibrate the chart’ for the tank (the ‘strapping chart’), but it is only at a very coarse level and lacks precision. Another way to perfect the tank chart might be to put a laser rangefinder inside the tank and measure it for various distances in every direction and then use that data to build up a finite element model. This process works best on a truly empty tank, which is rare, so while the method is precise, it could also be inaccurate. 

A third way would be to measure the amounts of fluid going in and out of the tank over time and record the corresponding heights. The inventory going into the tank must equal the fuel exiting the tank, unless there is some evaporation, breathing loss, or temperature-based shrinkage or expansion. This is close to perfect since we can account for the latter factors and record precise height measurements. The height measurements do not have be accurate for most purposes except for run-out estimates.  

We are mainly interested in the changes in volume for changes in height (the differential domain). It does not matter much whether our ruler is on the bottom of the tank or 10 feet below the tank (see Figure 3) in order find height differentials. 

Figure 3. Height Difference Measurement

From Perfect Chart to High ROI

Titan has developed novel and innovative methods for analyzing the changes in height and volume that produce a tank chart that is much closer to perfection now than any prior methods in the industry. The Titan Cloud Perfect Chart is accurate and precise (the units of volume are micro-liters, and the height is measured in micrometers) which allows Titan to provide its customers with: 

• Inventory variances close to zero (0.8%) 
• Delivery measurement within 0.7% (+/- 3.4 gallons on a 5,000-gallon delivery) 
• Rapid and sensitive leak detection – even tiny leaks can be detected within hours instead of days or weeks
• Measurement of dispenser meter drift – meters can be properly re-calibrated to ensure that correct revenue is received for fuel sold, and weights and measures compliance risk is eliminated

The Perfect Chart serves as the foundation for Frictionless Fueling, Titan Cloud’s wetstock management solution that leverages your existing forecourt equipment for a greater return on your software investment. By starting with a precise and accurate tank chart, Frictionless Fueling helps convenience store owners and operators minimize inventory variance and increase profits at every site monthly. 

Want to know how Frictionless Fueling can help you boost profitability? 

Contact one of our specialists, so you can start managing your wetstock with confidence. 

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.