Truckers struggle with diesel prices
May 21—If you're going anywhere in a diesel truck these days, you'd better take a lot of cash or a credit card with a high limit because the price of a gallon is even higher than gasoline's.
"It has definitely changed the way everything is working," Trans Pecos Trucking Operations Manager Mike Wahl said. "I don't know of anybody personally, but I keep hearing that quite a few operators have gone belly up.
"A year ago it was $3.19 a gallon and now it's $5.09. Two weeks ago it was $5.51. Sometimes I don't get loads because I bid too high, but I don't want to go in the hole. It's killing over-the-road haulers."
The national average price of gas Tuesday was $4.483 per gallon.
With Wahl's five 18-wheel trucks each carrying 300 gallons, it now costs over $1,500 to fill them up. Getting about six miles a gallon and idling the engines all night as the drivers sleep, refueling is a constant necessity.
Based at 255 Georgia St. on Odessa's north side, Trans Pecos had two trucks in Dickinson, N.D., May 11. "With the war in Ukraine, I don't see it getting any better in the future except maybe by a small percentage," Wahl said.
"There are also a lot of political things going against the oil companies. They're leery of borrowing millions or billions for drilling because we have an administration that's hell-bent on green energy.
"I'm all for saving the planet, but who knows what the answer is?"
Mark Finley, a fellow in energy and global oil at the Baker Institute of Public Policy at Rice University in Houston, attributes the prices to a number of refinery closures worldwide and in the United States and a big jump in demand for refined products as the pandemic waned. "The global refining system has become stretched," Finley said.
"This has pushed up refining margins and the costs of refined products in general have risen more sharply than crude oil prices. Russia exported not only crude oil but was also the world's second biggest exporter of refined products after the U.S. The single largest refined product exported from Russia was diesel. While their primary market for diesel exports was Europe, the market for diesel, as for crude oil, is global.
"So a disruption anywhere drives prices higher everywhere."
Dave Musgraves, general manager of E.L. Farmer & Co. at 1002 S. County Road West, said rampaging expenses are combining with a shortage of drivers to make conditions extremely challenging. "We're all in the same boat," Musgraves reported.
"Thirty percent of our revenues are going to fuel. We're running 100 owner-operated trucks but could use another 25. We had a limit of $700 or $750 a day on the fuel cards we supplied our drivers, but we had to raise it to $1,000 so they could fill their 200- to 250-gallon tanks all the way up. Sometimes it takes over $1,000."
"I've never seen prices this high," he said. "The last peak was $4.25 or $4.50 in 2017 or '18, but this one seems to have more staying power."
Musgraves confirmed that some truckers are giving up. "Guys are selling their trucks and getting out of the business," he said.
"Have a flat on the side of the road and it costs twice as much to get a tire man to come out."
