Editorial: Doing Something About Fuel Prices

img src="/sites/default/files/images/articles/printeditiontag_new.gif" width=120 align=right>Diesel fuel prices continue to be front-page news. In fact, most of us have begun to view fuel prices much as we view the weather: We can talk and talk about them, but we can’t do anything to change them.

As near and dear as fuel prices are to trucking, and to the profitability of the industry’s fleets, we continue to be pushed around by whatever wind is blowing. It doesn’t matter what the cause is — internal political strife in Venezuela; the beating of the drums of war in the Persian Gulf; mechanical problems at oil rigs in the North Sea — the result is always the same: higher prices.

Higher fuel prices mean trouble for U.S. trucking. And that eventually means higher prices for shippers, which leads to higher prices for consumers.

This is why William J. Canary, in one of his last acts as president of the American Trucking Associations, on Jan. 14 asked President Bush to consider tapping the nation’s Strategic Petroleum Reserve to help push down fuel prices.

Much of the recent run-up in petroleum prices has been attributed to concerns about the consequences of armed conflict between the U.S. and Iraq on oil supplies. Of late, civil unrest in Venezuela, which has led to a severe general strike and a near shutdown of that nation’s large oil company, has fed the price spiral.

Canary, in a letter to the White House, said escalating fuel prices could have a “devastating effect” on trucking.

“With every 10-cent increase in the price of diesel fuel, on average 1,000 motor carriers with five trucks or more in their fleet will file for bankruptcy,” Canary told the president. “And this excludes the potentially thousands of smaller truckers that will fail in the same environment.”

Canary said, “To stay healthy, we need to make sure that there is enough diesel fuel available at a reasonable price.”

Then-President Clinton permitted oil companies to utilize the SPR in late 2000, when petroleum prices were skyrocketing even though inventories were substantially higher than they are today.

We need help from the top in freeing fuel prices from being hostage to the flow of world diplomacy. And if that means, at least in part, turning on the spigot at the SPR, we hope the president will do so.

This article appears in the Jan. 20 print edition of Transport Topics. Subscribe today.