Basis is the gap between a local fuel price and the national benchmark price it is quoted against. It shows what your own area is doing on top of the broad market.
Fuel prices are often set as a benchmark plus or minus a few cents. The benchmark is a big national or regional market number that everyone watches. The basis is the local difference: how far your terminal’s price sits above or below that benchmark on a given day.
It moves with local conditions. When a nearby refinery has trouble, a pipeline backs up, or demand spikes in one region, the local price climbs faster than the benchmark and the basis widens. When local supply is easy, the basis can shrink or even go negative.
For a buyer, watching the basis tells you whether a price problem is national or just in your backyard. A widening basis means your area is tighter than the country as a whole, which is a signal to lock in supply, lean on a second source, or pass the cost along before it grows.
In useThe national number barely moved, but the local basis blew out a nickel after the refinery hiccup, so the jobber’s real cost jumped while the headlines stayed quiet.
See also Spot price, Rack price, OPIS