Diesel Prices Hit Record High, Putting More Pressure on Truckers

Truck drivers and owner-operators are feeling squeezed at the pump as diesel prices climb to record levels across the country.

According to the Associated Press, the national average for diesel reached $5.85 per gallon in early September, a record at the time and nearly 56% higher than the roughly $3.76 average seen before the U.S.-Iran war began in late February.

And unfortunately for truckers, prices have continued moving higher since AP’s original report.

Diesel Has Continued Climbing

AP News also reported that the national diesel average had risen to nearly $6.06 per gallon, up from $5.85 just one week earlier and about $3.71 at the same time last year.

For an owner-operator putting hundreds or even thousands of gallons into a truck each month, increases of that size can quickly become one of the biggest expenses of staying on the road.

The situation has become even more challenging in recent days. AP reported on September 17 that diesel had reached record highs around $6.40 per gallon, showing just how quickly fuel costs have been changing.

What’s Sending Diesel Prices Higher?

According to AP, much of the increase is tied to rising crude oil prices and disruptions to global oil supplies amid the ongoing conflict involving the United States, Israel and Iran.

The Strait of Hormuz has been particularly important. Before the conflict, roughly one-fifth of the world’s oil supply passed through the narrow waterway, according to AP. Shipping disruptions there have contributed to volatility in global energy markets.

Crude oil prices have also returned to triple digits. Brent crude, an international benchmark, recently settled above $100 per barrel, while U.S. benchmark crude finished near $96.

Because crude oil is the primary ingredient used to make diesel and gasoline, those increases can eventually show up on fuel station signs across the country.

Truckers Feel the Impact First

For most motorists, higher fuel prices mean spending more each time they fill up. For truck drivers, fuel is a major business expense.

For example, consider a truck taking on 150 gallons of diesel. At $3.76 per gallon, that fill-up would cost about $564. At $6.06 per gallon, the same amount of fuel would cost approximately $909 — roughly $345 more for a single fill-up.

Multiply that difference across weeks of hauling freight, and the additional expense can add up quickly, particularly for owner-operators and small fleets paying their own fuel bills.

Fuel surcharges can help offset some of those costs depending on the freight, contract and carrier, but they don’t necessarily eliminate the pressure caused by rapidly changing diesel prices.

Higher Diesel Costs Don’t Stop at the Truck Stop

Truckers aren’t the only ones affected.

Diesel powers much of the freight network responsible for moving food, clothing, furniture and countless other products around the country. AP reports that businesses have already begun passing some higher transportation costs along through additional fees, while prolonged diesel increases could eventually contribute to higher prices on store shelves.

Food can be particularly sensitive because produce, meat and other perishables have to be transported and restocked frequently. Diesel is also used by farm equipment involved in producing some of those goods.

That means what truckers are seeing at the pump could eventually work its way through the entire supply chain.

Another Challenge for Owner-Operators

Fuel has always been one of the expenses truckers watch most closely, but swings of several dollars per gallon can dramatically change the economics of a load.

For owner-operators, that makes calculating fuel costs, understanding fuel surcharge agreements, planning routes and shopping for lower-priced fuel even more important when deciding whether a load makes financial sense.

And with global oil markets remaining volatile, there’s no guarantee prices will settle down quickly.

For now, truckers across the country are once again being reminded just how much a few numbers on the diesel sign can affect the bottom line.

The Bottom Line

For truckers and owner-operators, every jump at the diesel pump cuts directly into the money left at the end of a run. With prices changing quickly and uncertainty still hanging over global oil markets, fuel costs are likely to remain one of the biggest issues drivers will be watching in the weeks ahead. Whether you’re running under your own authority or driving for a carrier, we’d like to hear what you’re seeing out on the road.