Top Trucker Concerns in 2022: Fleet Fuel Costs and Others

According to a recent American Transportation Research Institute (ATRI) report, the number one concern of U.S. trucking companies is how to reduce fleet fuel costs. This marks the first time this issue has made the top ten list in nine years. Up until this year, the problem of driver shortages was the number one concern for five years straight.

Here’s why stakeholders in the trucking industry are so concerned about fuel prices and how you can reduce fleet fuel costs.

Even two years after COVID-19, geopolitical and macroeconomic events continue to destabilize many industries and people’s lives. It’s no simple task to accurately pinpoint the root cause of persistent problems, such as supply chain shortages, labor shortages, and inflation. However, there are some concrete reasons why the rising cost of diesel fuel is a grave concern in the trucking industry, so let’s look at the tangibles.

According to ATRI’s report, year-over-year fuel cost per mile increased by over 35% during 2022. It also states west coast fleet operations pay the highest fuel cost per mile at $0.431. These fuel cost hikes severely strain owner-operators because they tend to operate in spot markets. Since these markets are less flexible with fuel surcharges, many owner-operators are forced to absorb higher fuel prices into their operating costs.

Diesel prices are dependent on the amount of global supply. And currently, diesel fuel inventories have reached historical lows. If diesel fuel production stopped today, energy industry experts estimate that we will have about a 25-day supply of diesel fuel. It’s a good thing for us that diesel production doesn’t stop. But the alarmingly low supply of available diesel fuel adds upward pressure to trucking fuel prices and makes it really difficult to reduce fleet fuel costs. Striking workers in French refineries also add to the potential crisis.

Russia’s invasion of Ukraine impacted the global energy market, especially in Europe. Due to the scarcity of natural energy sources in Europe it is heavily dependent on the Russian hydrocarbon industry, which makes them Russia’s biggest customer. Some countries like Lithuania and Finland import over 80% of their oil from Russia.

Even before Russia’s Ukraine’s invasion began, Russia’s oil production was low because of the slow recovery in Europe from the COVID-19 pandemic. Subsequently, the economic sanctions from the U.S., Europe, and other Western governments further hindered Russian hydrocarbon output.

The results of these war-related events have caused a global disruption in the oil and diesel fuel supply. Consequently, diesel fuel prices have risen to record-breaking levels. For example, the 27% February to March 2022 diesel price increase was the largest month-over-month gain on record.

Trucking industry insiders are not only concerned with the current state of diesel prices but also ponder the future of diesel prices. At this point, there is no way of knowing how long geopolitical tensions will play a role in the global fuel supply. On March 8, 2022, President Biden banned U.S. petroleum, natural gas, and coal imports from Russia. Most media outlets stressed that Russian crude oil only accounts for 3% of the U.S.’s crude oil imports.

However, based on 2021 figures, the U.S. imported about 20% of its petroleum products from Russia. Consequently, this ban adds to a decrease in the distillate trade and limits the U.S. diesel supply – which in turn ultimately increases fleet fuel costs.

Diesel refining is also subject to inflation. Like many other industries, diesel refiners deal with higher feedstock prices, supply chain shortages, and increased labor costs. These peripheral costs for refining diesel contribute to higher diesel prices.

Truck industry stakeholders have virtually no control over the forces influencing their No.1 concern: fleet fuel cost. However, fleet managers have the potential to reduce diesel fuel consumption and gain fleet fuel savings through route optimization and route planning.

Solera Fleet Solutions fuses the most advanced artificial intelligence and machine learning to make the most cost-effective use of your diesel fuel and your drivers’ time. Our transportation management software allows you to use route optimization technology to generate fleet fuel savings, plan the safest routes, communicate updates to your drivers,  and maintain an automated vehicle maintenance schedule.

Every industry or organization has challenges. Modern technology allows truckers and trucking companies to capture data that helps rise to those challenges. Route-optimizing software like Omnitracs can help you reduce fleet fuel costs and manage your fleet more effectively to get maximum value for the miles your fleet travels. Learn more about what Solera Fleet Solutions can do for your business today.