Diesel Prices Surge, Spot Rates Plunge: Why Trucking Costs Are Disconnected

Diesel prices are soaring, but spot rates continue to fall, creating a significant disconnect in the trucking market. This SONAR Market Update dives deep into the factors driving this divergence, from global conflicts impacting refinery output to shifts in intermodal rail and changing length of haul for truckload freight. Understand what this means for carriers and shippers navigating a volatile market.

Diesel prices have climbed steadily since early July while spot truckload rates have moved in the opposite direction — a divergence that FreightWaves’ Craig Fuller and Julie Van de Kamp say reflects a market governed by supply and demand, not fuel costs. The disconnect matters to every shipper paying fuel surcharges pegged to retail diesel and to every carrier trying to protect margins in a softening spot environment.

Van de Kamp was direct about the mechanism: “There’s a clearing price in freight that’s set by supply and demand,” she said, noting that rates per mile and diesel price per gallon have been trending in opposite directions since at least July. Fuller echoed the point, saying spot rates “are based on supply and demand and what the market will bear at the moment” — not on what diesel costs at the pump.

The diesel pressure has geopolitical roots. Van de Kamp attributed the bulk of the problem to Ukrainian drone strikes on Russian energy infrastructure rather than Middle East tensions. She noted that the crack spread — the margin between crude oil prices and diesel — is at all-time record highs, and that videos circulating on social media show lines of vehicles waiting hours for fuel at Russian stations. “The Ukrainians are continuing to just take drones, civilian drones, and attack infrastructure,” she said, adding that she sees little near-term relief.

“I don’t get the sense that this is going to resolve itself anytime soon. And I think the pressure on civilian infrastructure and supply chains is going to be more and more significant. It’s going to put more pressure on that diesel price.” — Julie Van de Kamp

On the volume side, outbound tender volumes have pulled back from a mid-year spike and are now tracking closer to 2023 levels, though still above last year’s figures. The duo called the July slowdown normal seasonality, noting that Labor Day falls a week later than in recent years, which has delayed the typical pre-holiday freight uptick. Tender rejection rates have settled around 13.5%, down from recent highs of 13.35% — still elevated versus prior years but stabilizing.

A key structural factor behind those trends is a pronounced shift to intermodal. Domestic intermodal rail volume is running well above prior-year levels, and Fuller said average truck length of haul has fallen sharply to 463 miles as longer lanes migrate to rail. Intermodal carries a roughly 34% cost discount versus truck, and Van de Kamp noted that Norfolk Southern and CSX have been the primary beneficiaries, with the modal shift concentrated in the eastern half of the United States — not just on transcontinental corridors.

Looking ahead, Van de Kamp said peak season is likely to be more muted than in prior years, partly because importers pulled freight forward earlier in the year via intermodal. She described the outlook as “slow and steady” and said the October–November surge that has historically marked peak season may not materialize with the same force in 2025. For contract carriers, that relative stability is a net positive; for spot-dependent operators facing rising fuel costs and falling rates, the margin math is increasingly difficult.

• Diesel prices have risen since early July while spot truckload rates have declined, proving the two data points are disconnected and driven by separate forces.
• Ukrainian drone strikes on Russian refineries are identified as the primary driver of diesel price pressure, with the crack spread at all-time record highs.
• Average truck length of haul has fallen to 463 miles as intermodal — priced at a 34% discount to truck — absorbs longer lanes, pushing tender rejections to roughly 13.5%.

This Summary is generated thanks to a transcription of the interview, for the full interview please enjoy the video above.