Demand destruction, caused by high fuel prices, can mean fewer consumer purchases and less freight moving.ĭenton Cinquegrana, chief oil analyst with OPIS, agreed. ![]() The one thing that could bring prices down is demand destruction, Flynn said, something that often augurs a recession, as it did in 2008 when oil prices peaked around $150 per barrel. "It's being based on fear and the unknown." Phil Flynn, an oil analyst at the Price Futures Group, said he sees no immediate decrease in prices, at least not ones caused by sudden peace in Ukraine or an increase in oil production. Hunt reported $3.5 billion in revenue in Q4, up 28% from a year before. Hunt's chief commercial officer and EVP for people and human resources, during the company's investor call on Jan. 19.īut the increase in fuel charges has tended to bump up general revenues for big fleets, especially with e-commerce still booming within the economic recovery. "As an organization, we see tremendous pent-up demand to convert highway freight to intermodal with elevated truck rates, the tight labor market, higher fuel prices and a 60% improvement in carbon efficiency intermodal offers versus truck," said Shelley Simpson, J.B. "It will hit the small guys hard," said Lewie Pugh, executive vice president of OOIDA. ![]() The recent surge in diesel prices has the phones ringing at the Owner-Operator Independent Drivers Association, with drivers asking how to attach fuel surcharges to their per-mile rates. Fuel costs a truck 43.3 cents per mile, or about 24% of a truck's expenses, according to the American Transportation Research Institute's November 2019 report.īig fleets usually have pricing deals with fuel suppliers, and they have fuel surcharges written into contracts. But those surcharges do not cover empty miles, and those fuel costs can squeeze margins of profitability.įuel is the second-largest expense for a fleet, after driver wages. ![]() Not surprisingly, prices in California are significantly higher than the norm: Diesel is $5.077 per gallon in the Golden State.įor now, fleets in general will pass the costs on to shippers via fuel surcharges, said Tim Denoyer, ACT Research vice president and senior analyst. Gasoline is also shooting up, at $3.608 per gallon, up 7.8 cents from the previous week, and up 89.7 cents from the comparable week a year ago.
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