If you’ve been to the pump lately, it’s impossible to escape the reality of high fuel prices. Diesel, specifically, is hitting record highs. And these rising costs have resulted in difficult choices for trucking companies.
When trucking companies raise fuel costs, many of these costs are passed down to the consumer, especially because almost everything that the end consumer buys has touched a truck in its delivery process. But there is only so much the end consumer can take before they simply don’t buy the product.
With inflation raising costs of living to unbearable levels for many working Americans, the urge to keep prices low and protect these people from passed-down fuel costs is high. But someone has to eat the rising costs of fuel, and that too often means truck drivers or trucking companies.
Especially for owner-operators who bid on freight, these rising fuel costs can still result in lost jobs and diminishing margins for drivers.
Wide Coverage of the Fuel Crisis
This has not gone unnoticed in the news, and it’s becoming a national and even an international crisis. The Wall Street Journal published an article called “Small Trucking Companies Are Getting Squeezed by Soaring Diesel Prices,” examining trucking companies in the wake of rising fuel costs that partially resulted from the recent Russian invasion of Ukraine.
Internationally, truck drivers have been striking over this issue as well. Despite a 1 billion euro plan to reduce fuel prices, a truck driver strike continues in Spain with demands for added relief. Dozens of tractors have continued their presence in the capital city of Madrid.
The local news is also covering the effect of the rise in fuel prices. Fox5 from Las Vegas covered a truck driving couple that started their own trucking company. Their small company owns four trucks with three drivers, and they’ve been pretty successful. Unfortunately, rising fuel prices hit this small company hard, and they can no longer make the profitable hauls from Las Vegas into California.
Escalation with Russia and Fuel Prices
If the Russian incursion into Ukraine is the major culprit for rising gas prices (a trend that was occurring even before that event), then an unscripted remark from President Biden doesn’t give much hope for a de-escalation in the conflict.
The US President remarked, “For God’s sake, this man cannot remain in power.” A seeming endorsement for regime change. The remark was criticized by the French President, among others, as a needless escalation.
Regardless, if US policy is to extend this conflict and the recent budget seems to affirm this goal, then trucking companies, drivers, and US consumers will be stuck with the consequences and realities of the global fuel market.