“It’s Been Difficult” – Small US Trucking Fleets Squeezed By Skyrocketing Diesel Prices
Russia’s invasion of Ukraine, disrupting commodity markets, and the worsening diesel shortage are wreaking havoc on small trucking companies pressured by soaring petroleum prices.
WSJ spoke with US trucking fleets and found smaller ones are susceptible to spiking fuel prices versus larger ones because they don’t have the hedging capacity and working capital.
The latest data from AAA shows the average price for a gallon of diesel at the pump is around $5.079, a record high and up more than 28% since the Ukrainian invasion in late February.
A price shock of this magnitude in such a short time has been brutal for small trucking operators with less leverage than larger fleets.
“It’s been difficult,” said Derek Crusenberry, director of business development at JSG Trucking Co. in Acampo, California, which has 20 trucks hauling lumber, steel, and canned products across Northern California.
“We have had to find ourselves diving into our margins to support operations, to keep the wheels turning, quite literally,” Crusenberry said.
Geopolitical turmoil in Eastern Europe and what Reuters’ head commodity analyst John Kemp has described, “worsening diesel shortages in the United States and the rest of the world are intensifying upward pressure on petroleum prices and threaten to recreate the conditions that led to the record price spike in 2008,” have led to JSG and many other smaller trucking fleets to react slower to changing fuel prices and inability to pass on additional fuel expenses. – READ MORE
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