New Jersey is facing a gas affordability crisis. Prices have been surging for months, with AAA projecting a record-setting August. A business that depends on fuel has to keep buying it, even as prices rise. Prediction markets gave me a way to hedge against further increases.
I own a contracting and hauling company serving northern New Jersey and southern New York. Our dump trucks spend the day moving materials to and from job sites, often going directly from one job to the next. With trucks running throughout the day, we are refueling constantly, making fuel one of our largest variable expenses.
This is a familiar problem for small-business owners. A recent National Federation of Independent Business survey found that about 80% of owners said energy costs have a significant impact on their businesses. Faced with higher energy prices, 58% reported accepting lower profits, and 52% raised their prices.
Those are the two choices owners are usually given: either absorb the increase or pass it along to customers. One reduces the money available to pay employees, maintain equipment, and invest in the business. The other raises prices for customers, which can make a business less competitive and cause it to lose clients. Neither helps an owner get control of the cost itself.
I had been trading on Kalshi casually, mostly on sports and elections. I never thought of it as something connected to my company until I found its fuel-price markets. Years of buying fuel for our trucks meant I already followed those prices closely and had developed my own view of where they might be headed. Then I saw how the same position could serve a business purpose.
A fuel-price contract lets me take a position on whether the average price will finish above a set amount. If it does, the contract pays out at the same time my company is paying more for fuel. The return can offset part of the added cost of keeping our trucks on the road. I would still rather pay less at the pump, even if that means the contract never pays out. The point is not to root for higher prices but to make an increase less damaging if it comes. That was when the trade became part of how I managed the company.
A hedge works best when it closely tracks the cost it is meant to offset. The first fuel market I traded followed national gasoline prices, but my company buys fuel in New Jersey. When local prices moved differently from the national average, the position was a weaker match for the expense I was trying to manage. I asked Kalshi for a market tied to New Jersey, and the exchange responded by listing daily and weekly New Jersey gasoline-price markets.
My concern is fuel because that is the cost I deal with every day. Another owner may worry about bad weather cutting into sales or a tariff raising the cost of supplies. Every business has its own version of that problem. The opportunity is to identify it early and decide whether a prediction market can help manage it.
Small businesses already plan around risks they cannot eliminate. We purchase insurance, keep money in reserve, negotiate with suppliers and adjust our prices when costs change. Large companies have used financial contracts to manage risk for decades, and prediction markets are now making that approach available to small businesses. These markets allow an owner to take a position on the specific event driving the cost before it hits the budget. The owner decides in advance how much to put toward that risk. A position can still lose, which is why I see it as one tool alongside the others, not a substitute for them. Used that way, it can turn an unexpected expense into a risk the business has already planned for.
I still watch fuel prices because running my business requires it. The difference is that now I can do something with that knowledge. When a cost beyond my control threatens the company’s bottom line, my choices are no longer limited to earning less or charging customers more.
Nick Juliano is the owner of Juliano & Son Contracting, a family-owned contracting and hauling company with more than 20 years of experience serving commercial and residential customers across northern New Jersey and southern New York.
