Commentary: Trucking vs. the diesel shortage

Throughout the last several months, the steady increase in diesel fuel prices has created a hectic pricing environment in the freight industry due to the inability to accurately factor in fuel costs for bidding months, or even weeks, in advance of hauling the load. This inconvenience already has the potential to be very costly, but what if the driver is turned away at the station where he or she intends to refuel because there is no diesel at the pump? Yes, this is a real possibility in today’s environment.

Certain locations are more prone to these shortages, mostly due to price differences from state to state. For example, diesel is a whole dollar less expensive in Arizona ($3.65 per gallon) than in California ($4.65 per gallon). As such, fueling stops will be planned to take place in Arizona. When this purchasing bias is repeated on a large scale, the state with the better prices faces a shortage of diesel.

This lack of consistency among states, accompanied by the steep spike in diesel prices that reached a seven-year high, plus the decrease in production and lack of hazmat-endorsed fuel haulers, are all contributing factors in a potential looming fuel crisis. As the cost of operation rises, so does the price tag on any one load. This price increase is happening unpredictably across the country and is causing concern among carriers and owner-operators alike.

As we know, owner-operators take on massive responsibility by purchasing, maintaining, and operating their own equipment. Often loads are bid for months in advance; however, with today’s fuel price fluctuations, advanced bidding is more risky than usual. These fluctuating fuel prices can cost an additional $300-$400 on a coast-to-coast load. This can cause awkward bargaining between owner-operators and their longtime customers who might not fully understand why their shipping costs are suddenly going up.