James Spencer, founder of Portland Fuel Price Protection Ltd, who was featured in The Sunday Times last Sunday as an independent expert in the row about allegedly unreasonably high prices being demanded for home heating oil, has developed a unique ’hedge’ or insurance against unexpected fuel price movements which is specially designed for vehicle operators.
This service has previously been primarily directed at fleets operating large vehicles – heavy trucks or buses. But the ongoing and high rate of volatility in fuel pricing makes it attractive to operators of car and van fleets too – whether they use diesel or petrol.
Portland provides fuel purchasing for managers of all sizes of vehicle fleets - without interfering with their chosen fuel supply method.
How it works:
- A fleet manager contracts with Portland for the price of fuel he is about to buy - prices can be fixed for any period from one week to 12 months.
- Portland is not involved with the purchase of fuel so the operator continues to buy their fuel in the normal way from their usual suppliers
- At the end of each month the price actually paid versus the price contracted with Portland is calculated and a cash settlement made.
- Where the price is higher than the price agreed, Portland refunds the operator the difference; where it is lower the operator pays Portland the difference.
- In this way there is total predictability of future fuel prices
- No up-front payment is required
Portland accepts volumes as low as 10,000 litres per month versus the normal banking minimum of 1,000,000 litres per month.
“We are not a competitor to traditional fuel suppliers (ie, bulk deliveries, petrol stations, fuelcards etc) meaning that our customers can obtain their fuel by whatever route they prefer“, says James Spencer. “Our contract with operators - the end user of the fuel - is a separate arrangement which can be seen as an over-riding insurance policy against sudden price movements. As we all know, they have been commonplace in recent years and in recent months have dramatically intensified.
“Essentially we are using our proven expertise in the fuel supply industry to help operators manage future fuel price movements - something most vehicle operators find it difficult to do. Our service, which can be cost neutral, provides complete peace of mind for risk-free budgeting and pricing purposes“, he said.