Every gallon a jobber sells passed through a terminal first. It is the big tank farm where fuel is stored in bulk and loaded onto trucks, the spot where wholesale fuel actually changes hands. Understand the terminal and the rest of the business gets easier to follow: rack pricing, the bill of lading, and the tax point all start here.
What a terminal is
A fuel terminal is a large storage and distribution facility. Fuel arrives in bulk by pipeline, barge, or from a refinery, and sits in big storage tanks until it is loaded into trucks for the trip to its final destination. The terminal is the handoff between bulk transport and local delivery, and it is where a jobber buys and lifts the fuel they resell. EIA counts roughly 1,400 petroleum product terminals in the US, owned mostly by refiners, pipeline companies, and independent operators such as Kinder Morgan and Buckeye Partners. Each approved terminal also carries an IRS Terminal Control Number, the ID that ties fuel tax reporting to a physical location.
The rack
Inside the terminal is the rack, the loading area where trucks fill up. Fuel is metered out of the storage tanks into the truck right there. The price suppliers post at that loading point is the rack price, and "buying at the rack" literally means loading here. The mechanics of that price are covered in rack pricing explained.
How loading works
A carrier pulls in, the load is authorized, and fuel is metered into the truck, often blended to the right grade and dosed with additives or dye along the way. The terminal then issues a bill of lading recording exactly what was loaded. That document is the seed for the jobber's billing, fuel tax, and inventory. FastDragon Fuel Jobber takes each BOL once and carries it through invoices, tax, and inventory so the lift and the books match.
The terminal and the tax point
The terminal is also where a lot of fuel tax attaches, which is the heart of the above-the-rack vs below-the-rack question. Whether tax is owed at the rack or further down the line shapes who pays it and how it flows through the books.
What people ask
How big is a fuel terminal?
EIA counts a facility as a bulk terminal once it holds 50,000 barrels or more, which is about 2.1 million gallons, and many hold far more across a dozen or so tanks. For comparison, a single gas station tank usually holds 10,000 to 20,000 gallons.
Is the rack price the same at every terminal?
No. Each supplier posts its own price at each terminal, so the same gallon of unbranded gasoline can cost different amounts across town or one state over. Postings typically change once a day in the early evening, and jobbers compare them to decide where to lift.
What does a driver need to load at a terminal?
An access card for that terminal, a CDL with tanker and hazmat endorsements, and an active loading authorization from a supplier on the buyer's account. Without a valid authorization at that rack, the gantry will not load the truck.
What is a Terminal Control Number (TCN)?
A TCN is the ID the IRS assigns to each approved terminal in the bulk fuel system. It appears in the ExSTARS fuel tax reporting that terminals file, and the IRS publishes the full TCN directory so anyone can look up an approved terminal by state.