Glossary of Terms Basis: The difference between the price of the actual commodity (e.g. heating oil) and the price of the futures contract. Basis can be calculated by subtracting the futures price from the cash price. Also called basis differential. Bearish: A market in which prices are declining. Brokers: Anyone who executes futures or options contracts in exchange for a commission fee. They match a buyer to a seller and collect a commission, but never touch the fuel. Bullish: a market where prices are rising Chain retailer: Big box stores, own the entire station. Among the most influential players in the U.S. retail fuel landscape. Company operated station: Refiner owns the land, pumps and any above-ground structures. Crude oil (CL): The primary feedstock used to make gasoline, diesel, jet, residual fuel and other finished petroleum products. Downstream: Term applying to functions or facilities closer to the end user. Refining, marketing and transportation are generally downstream processes in the oil patch while exploration and production are upstream. End-Users: The ultimate consumer of petroleum products. Fungibility: Term which refers to the likeness or least interchangeability of a petroleum product. The less fungible the product, the less likely it is to succeed in the futures arena and the more problem it is likely to create in the distribution process. Hypermarketer: A big box retailer who sells fuel to get the customer into the store to buy items other than gasoline, often sacrificing margin for the sake of inside sales. Jobbers/Distributors: Someone who purchases refined products at the wholesale level and then transfers or resells the product at the retail level. Lessee dealer: Lease or rent the retail station space and absorb the costs of operating the station. Fuel Buying 101, Glossary of Terms | Oil Price Information Service (OPIS) © 2020, all rights reserved 25