Pitfalls to Avoid When Purchasing Jet Fuel

> | October 9, 2012 | 0 Comments
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Pitfalls to Avoid When Purchasing Jet Fuel

Planning jet fuel uplifts is a key activity in business-aviation pre-trip preparation, but it’s a planning aspect that’s often not given as much attention as it should. Carefully organizing international fuel uplifts will not only save on trip costs but also reduce the possibility of delays at worldwide destinations. Work with your 3rd-party provider in advance to maximize your fuel cost and tax-saving opportunities and to avoid uplift delays.

Here are tips to help you succeed at uplifting jet fuel:

1. Not all aviation fuel providers and programs are the same

In today’s marketplace, there are many aviation fuel providers offering a variety of options, including varying credit terms, administrative fees and pricing options (in other words, all the different ways one can buy jet fuel.) Additionally, available services include aviation fuel cards, fuel releases, online services to order fuel and 24/7 operational support. Some providers are Value Added Tax (VAT)-registered in Europe and offer VAT exemption programs in many different European countries. This can result in significant cost savings for eligible operators. Do your homework and know what your provider can do for you.

2. Obtaining a jet fuel quote does not guarantee price or service

Aviation fuel providers can change pricing frequently, and frequency of price changes varies by location. When comparing jet fuel prices, always ensure that you’re comparing the same information. The important thing is to compare the base prices among fuel quotes and to make sure you are aware of all applicable fees and taxes. For example, some providers may charge an additional fee for uplifts of less than 1,000 U.S. gallons. Also, be aware that a fuel company may offer cheaper pricing than the competition at certain locations, but Fixed Base Operators (FBOs) may not permit these trucks on their ramp, and you may need to reposition to obtain the cheaper fuel. Additionally, cheaper fuel from a commercial fueler may be available on the general aviation (GA) ramp, but scheduled commercial operations will normally have fuelling priority. While fuel trucks may be on standby when you arrive, this is not always the case, especially at busy commercial airports, where scheduled commercial operations have fueling priority. Vicki Matso wrote a great article on comparing jet fuel quotes, which spells out in more detail what to look out for.

3. You’ll need more than just an aviation fuel card at some locations

At certain locations, you may need more than an aviation fuel card to obtain fuel. At some locations, you’ll require a fuel release issued in advance, and, in rare cases, cash may be required. Best practice is to do your homework and work with your fuel provider in advance in terms of fuel release and other location-dependent requirements. Be aware that if you pay for fuel with cash or consumer credit cards, you’ll usually pay posted airport rates.

4. Read fuel tickets carefully before signing

Even though you may be operating as charter (non-scheduled commercial), it’s necessary to show appropriate paperwork and to check correct fuel ticket boxes in order to exempt taxes at the pump. It is good practice to show the Air Operator Certificate (AOC) at the time of fuelling and to ensure that the words “AOC SHOWN” are notated on the fuel ticket before signing to help avoid incorrect taxes.

5. There can be issues with fueling if appropriate arrangements haven’t been previously made

At some locations, the fueler may not accept your aviation fuel card and may require a fuel release in order to supply the contracted fuel. At other locations, the fuel truck may not be standing by on arrival if you haven’t pre-arranged the fuel, and this may lead to significant delays. In some cases, there may be “hidden charges,” including afterhours charges or unusual taxes such as the “Customs Duty” that applies in India to tankered fuel on board at arrival when your next leg is domestic. There’s also the risk of being fueled by the wrong fueler, which will negate your previously negotiated contract price.

6. There are ways to avoid problems

Take the time to research each destination to obtain all requirements and local nuances pertaining to fuel. If jet fuel quantities are limited at your destination, or delays are likely due to peak-hour commercial operations, you may want to consider fueling on arrival or tankering fuel. Always confirm that you’re being fueled by the right provider and be diligent in reviewing fuel tickets prior to signing. Determine in advance if you can fuel on the ground handler/FBO ramp or if you’ll need to reposition elsewhere on the field for fuel uplift.

7. Certain standard steps should be taken when uplifting jet fuel

Always check jet fuel prices, applicable taxes and tax exemption requirements pre-trip. Enroll in a VAT exemption program – particularly when operating to Europe. Confirm on day of arrival or departure that there are no fuel issues on the field. When the truck arrives, ensure it’s the fueler you’ve made arrangements with.

8. Be aware of special fuel procedures at certain destination airports

Consider requirements for fuel releases and other evidence of fuel credit. Some aviation fuel suppliers at the same airport may accept aviation fuel cards, while others will require fuel releases. Know the location where you’ll be fueled and be aware of FBO or fuel supplier restrictions on where aircraft may be fueled. If special arrangements must be made for late-night fueling, know any applicable overtime charges for both the jet fuel uplift and any fire safely equipment that will need to be available on standby. At some airports, fuel will need to be specially brought to the field. For example, when fueling at Grosseto (LIRS), you’ll need at least 24-hours’ notice for a fuel truck to be brought in from Rome Ciampino (LIRA), and additional charges or cancellation fees may be involved.

Conclusion

While aviation fuel planning may not be the most exciting element of international trip planning, it can have a big impact on your operation from both cost and operational delay perspectives. Best practice is to plan all jet fuel uplifts before you go, confirm fuel delivery schedules and potential delays day of trip and be vigilant in terms of documentation and fuel ticket accuracy.

Questions?

If you have any questions about this article, contact me at barryburton@univ-wea.com.

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About

Barry Burton has nearly three decades of experience in the aviation industry and more than 10 with Universal Weather and Aviation, Inc. A 15-year veteran of the Royal Air Force, since joining Universal in 2000, Barry has gained experience in multiple roles, including Trip Support Services, Flight Planning, and UVair Fuel. Prior to joining Universal, Barry served as an Air Traffic Control, Operations and Mission Planner for two different charter airlines. Barry’s business aviation expertise has been recognized by industry associations and publications, and he has been asked to speak at the National Business Aviation Association’s International Operators Conference.

Barry can be reached at barryburton@univ-wea.com.

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