Fuel offering and purchase management system

• US 8,442,901 B2
• Filed: 12/23/2011
• Issued: 05/14/2013
• Est. Priority Date: 04/09/2007
• Status: Active Grant

• Current Assignee: Goldman Sachs & Company (Goldman Sachs Group Incorporated)
• Original Assignee: Goldman Sachs & Company (Goldman Sachs Group Incorporated)
• Inventors: Kirch, Michael, Sanghvi, Saurabh, Sharfman, Daniel
• Primary Examiner(s): Lemieux, Jessica
• Application Number:
  US13/336,382
• Publication Number:
  US 20120271685A1
• Time in Patent Office: 508 Days
• Field of Search: 705/37
• US Class Current: 705/37
• CPC Class Codes: G06Q 30/0283 Price estimation or determination
• CPC Class Codes: G06Q 30/06 Buying, selling or leasing transactions
• CPC Class Codes: G06Q 40/04 Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange

Abstract

The present disclosure is directed to facilitating pricing, sales and delivery of a commodity. In one embodiment, a Fuel Offer Generator facilitates the purchase and management of fuel offerings. The Fuel Offer Generator allows Customers interested in securing fuel to obtain an offer for fuel at lock-in prices for various tenors. Fuel Customers may later exercise the fuel offers so their fuel costs are locked-in at desired levels The Fuel Offer Generator may generate hedges to counteract fuel related risks stemming from fuel offer purchases. Ultimately, a customer that purchases a fuel offering can exercise their fuel offering order at a specified price and redeem any difference between the market price for their purchased fuel and the price specified in their fuel offering order. The Fuel Offer Generator allows for the management of regional fuel price offerings and allows for fuel offering redemption based on fuel pump prices.

Claims

1. A computer processor-implemented method to provide commodity offerings, comprising:

setting, by a computer processor, at least one commodity offering term for a commodity offering, including a specification of a plurality of geographic zones;

determining, by the computer processor, at least one commodity offering pricing value based on the at least one commodity offering term and at least one commodity offering pricing model for the commodity offering;

providing, by the computer processor, the commodity offering, including at least one association, based on the commodity offering pricing value, between a strike price and a premium, for selection by a customer;

receiving, by the computer processor, a selection of the at least one commodity offering by the customer;

monitoring, by the computer processor, a location at which the selected commodity offering is exercised; and

providing payment for some portion of a commodity purchase made by the customer for the exercised commodity offering based on a relationship between the monitored location of the exercised commodity offering and the geographic zones, wherein the payment is adjusted by an adjustment amount if the monitored location is not a most expensive of the geographic zones.

2. The method of claim 1, wherein the commodity offering is a fuel offering.

3. The method of claim 1, wherein providing the commodity offering includes specifying the adjustment amount.

4. The method of claim 1, wherein the adjustment amount is determined when the commodity purchase is made by the customer.

5. The method of claim 1, wherein the strike price is pre-selected and the premium is determined based at least in part on the strike price.

6. The method of claim 1, wherein the premium is pre-selected and the strike price is determined based at least in part on the premium.

7. The method of claim 1, wherein the commodity offering pricing model includes at least one commodity market variable.

8. The method of claim 7, wherein the at least one commodity market variable includes at least one local retail commodity price.

9. The method of claim 7, wherein the at least one commodity market variable includes one or more of:

wholesale gasoline over-the-counter options market data, wholesale gasoline over-the-counter forward market and futures market data, retail gasoline spot prices, and wholesale gasoline implied volatilities.

10. The method of claim 1, further comprising determining whether the at least one association is satisfactory.

11. The method of claim 10, wherein the determining whether the at least one association is satisfactory comprises:

querying a market information database for market data; and

determining whether said association is satisfactory based on the market data.

12. The method of claim 1, wherein the commodity offering pricing model comprises a commodity volatility model described by a stochastic differential equation.

13. The method of claim 1, wherein the setting the at least one commodity offering term is based on a customer specification of at least one of:

a desired strike price, a desired premium, a desired tenor, and a desired commodity type.

14. The method of claim 1, wherein the payment for some portion of the commodity purchase is further based on a commodity purchase size and a difference between the strike price and a local retail commodity price associated with commodity purchase.

15. The method of claim 1, further comprising:

recording the selection in a customer selection database; and

executing a hedge based on the customer selection database.

16. The method of claim 15, further comprising:

aggregating entries in the customer selection database into at least one similarity class prior to executing the hedge; and

executing the hedge further based on the at least one similarity class.

17. The method of claim 16, wherein aggregating entries is based on at least one of:

the at least one commodity offering term, the commodity offering pricing model, customer characteristics, and risk considerations.

18. The method of claim 15, wherein the hedge includes the purchase of at least one forward contract.

19. A system for providing commodity offerings, comprising:

a memory including computer processor executable instructions; and

a computer processor configured to retrieve the instructions from the memory and execute the instructions to;

set at least one commodity offering term for a commodity offering, including a specification of a plurality of geographic zones;

determine at least one commodity offering pricing value based on the at least one commodity offering term and at least one commodity offering pricing model for the commodity offering;

provide the commodity offering, including at least one association, based on the commodity offering pricing value, between a strike price and a premium, for selection by a customer;

receive a selection of the commodity offering by the customer;

monitor a location at which the selected commodity offering is exercised; and

provide payment for some portion of a commodity purchase made by the customer for the exercised commodity offering based on a relationship between the monitored location of the exercised commodity offering and the geographic zones, wherein the payment is adjusted if the monitored location is not a most expensive of the geographic zones.

20. A non-transitory computer-readable medium comprising instructions that, when executed by one or more computer processors, direct the one or more computer processors to:

set at least one commodity offering term for a commodity offering, including a specification of a plurality of geographic zones;

determine at least one commodity offering pricing value based on the at least one commodity offering term and at least one commodity offering pricing model for the commodity offering;

providing the commodity offering, including at least one association, based on the commodity offering pricing value, between a strike price and a premium, for selection by a customer;

receive a selection of the commodity offering by the customer;

monitor a location at which the selected commodity offering is exercised; and

provide payment for some portion of a commodity purchase made by the customer for the exercised commodity offering based on a relationship between the monitored location of the exercised commodity offering and the geographic zones, wherein the payment is adjusted if the monitored location is not a most expensive of the geographic zones.