Subscribe to our free, weekly email newsletter!

Diesel prices are up for sixth time in last seven weeks

By Staff
March 11, 2014

Following its first decline in six weeks, diesel prices resumed on a growth path, with its sixth increase in the last seven weeks, according to the Department of Energy’s Energy Information Administration (EIA).

With a $0.5 cent gain, the average price per gallon headed up to $4.021, marking the highest average price per gallon since checking in at $4.047 the week of March 18, 2013. Over the past seven weeks, including last week’s decline, the average price per gallon has gone up a cumulative 14.0 cents.

And the average price per gallon has now been over the $4 mark for the third straight week, falling well short of an eight-week stretch from February 4, 2013 to March 25, 2013, when prices were above the $4 mark.

On an annual basis, even with recent weekly gains, the average price per gallon of diesel is down 6.7 cents, and on a year-to-date basis, it is up 11.1 cents (since the week of January 6).

As prices continue to rise, adjusting budgets is only part of the solution when it comes to dealing—and living—with fuel price fluctuation, according to shippers.

In some cases they look for hedge diesel prices when it is applicable, shippers have told LM. This involves committing to a certain price on fuel at which pay to a certain rate at which point it is frozen at that rate for the shipper. And it also requires shippers to be focused on keeping their drivers on the road as much they can and being profitable and not in detention.

As previously reported by LM, other steps being taken by shippers to combat high fuel prices include things like focusing more on utilization and efficiency by doing things like driving empty miles out of transportation networks.

And the fact that if prices rise on average has a direct effect on fuel surcharges paid by shippers is always top of mind for them.

“Continued increases in fuel surcharge will drive shippers ultimate transportation spend to all time highs,” a shipper said in an interview. “Carriers will do all they can to pass any excess cost back to the shipper, smaller carriers are definitely feeling the pain associated with the fuel increase and are demanding more for their services.  When it becomes time to negotiate rates, carriers will be talking a lot about the cost of fuel and using it as a leverage point for general rate and line haul increases.  Shippers must be acutely aware of what percentage of their invoice cost is actual fuel surcharge.”

Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

The United States Environmental Protection Agency (EPA) has awarded the Port of Oakland $277,885 to upgrade cargo-handling equipment and reduce exhaust emissions on the waterfront.

Entitled the Positive Train Control Enforcement and Implementation Act of 2015, the bill would extend the 2015 PTC implementation deadline to the end of 2018.

Carloads were down 5.4 percent annually to 285,856, and intermodal was up 2.1 percent to 280,844.

Did you know that there is a correlation between logistics solutions and customer loyalty? 70% of customers are willing to spend more money for good customer service which means you must have on-time delivery, proficient inventory management and a strong logistics strategy.

While coffee is one of the first things on the minds of many people early in the morning, it was especially prevalent this week, when Starbucks Chairman and CEO Howard Schultz gave the keynote address at this week’s Council of Supply Chain Management Professionals (CSCMP) Annual Conference in San Diego.

Article Topics

News · EIA · Diesel Prices · Diesel · All topics


Post a comment
Commenting is not available in this channel entry.

© Copyright 2015 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA