U.S. diesel prices continue to drop
Retail diesel's national U.S. average price per gallon of $3.59 in October is up from $3.56 in September and much lower than the $4.51 average from October 2023. This marks the 20th consecutive month of year over year decreases in fuel, but just the second time in 2024 that has seen a month over month increase.
As mentioned in the August 2024 Freight Market Update, in a soft market, carriers often will need to deadhead longer mileage to find a load. While fuel is largely considered a pass-through accessorial, deadhead is often a sunken cost for carriers, especially in soft markets.
This continuing decrease in diesel pricing is another alleviating factor contributing to the persistence of smaller carriers, as the extra deadhead isn’t necessarily equating to further sunken costs. If diesel prices increase, it would add more strain to carriers and speed up carrier attrition from the market.
