jbunt

I retired from a large petroleum marketer. During a year, we averaged about $1 million a month in profits from hot gas. Zero during the winter and more during the summer to average $12 million year. We are located in the Southwest. When it is 100 degrees out, the fuel coming out of the refinery that we load is very hot. So, in a typically good transaction, our truck will load and pay for 7,200 temperature corrected gallons gallons and the actual physical quantity will be 7,500 gallons. That is 300 free gallons, and since taxes are paid at the rack (started about 10 years ago to prevent tax cheating), no federal or state taxes on the 300 gallons. The retail pump price charges both for the product and for the taxes, which taxes do not have to be paid because they were already paid at the rack. So at $3 gallon, we make an additional $900 or $.125 cents/gallon "extra" on each of the 7,200 gallons. And, most of the reason is that the 75 degree gallons, which are put in the underground tank, hold much of that temperature until sold. At a large volume station, it is likely that the fuel is sold within 24 hours.

Do you know the temperature that the fuel comes out of a refinery? I do not know such things, but I think that the temperature that we get with our purchase varies by the ambient temperature of the air, e.g., a 100 degree day, and the amount of time between the refinery run and our purchase. While working, I never did a study, but I think that the anecdotal comments were that fuel coming from a refiner's racks could be hotter than fuel coming from pipeline terminal racks.