LYNCHBURG, Va. – The tension and conflict in Europe is already leading to higher oil prices — especially when it comes to diesel — and it’s taking a toll on the trucking industry.
“The price of diesel is a little over a dollar more than it was a year ago, so that is a significant cost increase; and those are increases the trucking industry simply cannot afford to absorb,” said Dale Bennett, president and CEO of the Virginia Trucking Association, which represents nearly 300 companies in the Commonwealth.
They’re already absorbing higher costs since the start of the COVID-19 pandemic, between equipment, insurance, and increased salaries to address a nationwide truck-driver shortage.
Gerald Prante, an economics professor at the University of Lynchburg, says the surge could have a domino effect.
“The trucking industry is going to see higher prices, shipping higher prices, which then feeds into high prices for all sorts of goods,” said Prante.
Bennett says they’re doing everything possible to maintain affordable prices, but if this continues they’ll be forced to offset the cost.
“We’re left with no choice but to pass those along to our customers in the form of fuel surcharges,” said Bennett.
Then people will look to save money elsewhere.
“Whenever the price of a good goes up, people look to see other options; and if the price of that good, such as diesel and regular gasoline is expected to stay elevated, people will make that longer-term investment,” said Prante.
That longer-term investment may be finding other methods of transportation, so Prante says we could see people buying more electric vehicles in the months ahead.