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After 6 weeks of declines, on-highway diesel shoots up 3.8 cents a gallon to $3.010

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By the time oil has gone through the refining process to get to diesel and by the time diesel gets to distribution centers and the local truck stop, it takes a week or two or more to catch up to the price of oil and whether the price direction is up or down.

Average on-highway diesel prices increased by 3.8 cents a gallon Monday to right above the $3-a-gallon mark at $3.010.

Last week made the sixth week in a row that the national average had dropped, according to figures from the U.S. Energy Information Administration (EIA).

Analysts kept saying oil [and therefore diesel] were headed back up. They just took their own sweet time doing it. In fact, The Associated Press reported Monday that benchmark U.S. crude fell 33 cents to settle at $65.55 per barrel on the New York Mercantile Exchange and that Brent crude, used to price international oils, shed 33 cents to close at $70.12 in London.

But it was about time for the old seesaw trick that oil and diesel perform. Oil goes one way as diesel goes the other way.

That happens because by the time oil has gone through the refining process to get to diesel and by the time diesel gets to distribution centers and the local truck stop, it takes a week or two or more to catch up to the price of oil and whether the price direction is up or down.

A few of the EIA’s reporting regions saw hefty price hikes in diesel Monday. For example, the West Coast Less California sector saw prices go up 8.7 cents a gallon to $3.147 from $3.060 the week prior.

The Rocky Mountain sector experienced a diesel price increase of 6.6 cents a gallon. Truckers there are paying $2.991 a gallon today compared with $2.925 last week.

And truckers in the West Coast region today are paying 5.4 cents more for a gallon for diesel — $3.438 — compared with $3.384 a gallon a week ago.

In EIA’s Lower Atlantic reporting region truckers are paying 4 cents a gallon more at $2.898 compared with $2.858 the week of March 19.

To see more diesel prices by region, click here.

After taking a slide Friday on fears surrounding President Donald Trump’s announcement that he was taking China to task for their copyright and other infringements against U.S. businesses, the stock market went back up Monday, though, and oil prices along with it. China said it is ready to deal.

In other energy futures trading, heating oil was little changed at $2.02 a gallon. Wholesale gasoline lost 2 cents to $2.01 a gallon. And finally, natural gas added 3 cents to $2.62 per 1,000 cubic feet.

So, if the price of crude continues to slide for days or even a few weeks, diesel prices will probably follow the leader and slide again, too.

If, however, Monday was just an oil hiccup and oil prices go back up, look for diesel prices to go back up again eventually.

But of course, so many things beyond our control make oil go up and down, it seems, from presidential announcements to political unrest in oil-rich countries to news on the U.S. interest rate.

So, stay tuned. Just like the weather, the prices of oil and diesel are always changing.

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ACT Research: Heavy duty markets at the edge of the precipice

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This graph by ACT Research shows freight growth will decline in 2020 and 2021 before accelerating in 2022, Class 8 truck productivity will remain in the negative through 2022 but will become less each year. (Courtesy: ACT RESEARCH)

COLUMBUS, Ind.  – According to ACT Research’s latest release of the North American Commercial Vehicle OUTLOOK, current data and anecdotes make a strong case that the heavy-duty vehicle markets are at the edge of the precipice.

“Since the start of this demand up-cycle in late 2017, we have targeted this year’s third quarter as the point at which the industry was likely to see production rollover,” said Kenny Vieth, ACT’s president and senior analyst. “That targeting was largely derived from historical precedent, with historical peak-level build lasting between 13 and 15 months. For the current cycle, we date peak build rates to June 2018, so August represents the 15th month of peak-level production.”

Regarding heavy vehicle demand, Vieth said, “At the heart of our cycle duration prediction, carrier profitability and production peaks always lag the freight cycle, so capacity building always accelerates relative to freight growth at exactly the wrong time, every time.

“Large new inventories and deteriorating freight and rate conditions suggest erring on the side of caution remains the right call, and we are warning those in the industry to be prepared for down weeks starting as early as fourth quarter.”

ACT Research is a publisher of commercial vehicle truck, trailer, and bus industry data, market analysis and forecasting services for the North American and China markets. ACT’s analytical services are used by all major North American truck and trailer manufacturers and their suppliers, as well as banking and investment companies.

More information can be found at www.actresearch.net.

 

 

 

 

 

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FTR’s June Trucking Conditions Index up slightly but still negative

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An FTR executive said although rates remain weak for carriers, they appear at least to be stabilizing. (The Trucker file photo)

BLOOMINGTON, Ind. — FTR’s revised Trucking Conditions Index (TCI) showed a significant improvement in June but remained in slightly negative territory at a reading of -0.82, according to FTR.

Strengthening freight demand and lower diesel prices were offset by weak truckload rates and easing capacity utilization plus some higher financing costs that negatively affected carriers during the month.

FTR’s forecast for the TCI is for it to remain in low single-digit negative range into 2020, but some positive readings are possible during 2019.

Details of the revised TCI for June are found in the August issue of FTR’s Trucking Update, published July 31. The ‘Notes by the Dashboard Light’ section in the current issue explains how FTR’s July 2019 Freight•cast model update affects key FTR metrics on the trucking industry, including the TCI. Along with the TCI and ‘Notes by the Dashboard Light,’ the Trucking Update includes data and analysis on load volumes, the capacity environment, rates, costs and the truck driver situation.

“Although rates remain weak for carriers, they appear at least to be stabilizing,” said  Avery Vise, vice president of trucking. “Meanwhile, freight demand appears firmer in recent weeks than in early spring, but the outlook is far from rosy given a softening industrial sector. Our biggest near-term concern, however, is the potential impact of the trade war with China on consumer spending and business investment.”

The TCI tracks the changes representing five major conditions in the U.S. truck market. These conditions are freight volumes, freight rates, fleet capacity, fuel price, and financing. The individual metrics are combined into a single index indicating the industry’s overall health. A positive score represents good, optimistic conditions. Conversely, a negative score represents bad, pessimistic conditions. Readings near zero are consistent with a neutral operating environment, and double-digit readings (up or down) suggest significant operating changes are likely.

As noted, FTR in July completed a major update of its Freight•cast model, including both updated data and enhancements to the methodology. FTR traditionally has treated the TCI as a contemporaneous assessment of overall conditions at a point in time, so we have made very few changes to historical TCI readings. However, given the noticeably different freight volume and utilization metrics following the model update – especially during 2014 through today – we have restated the TCI back to January 2014. The historical revisions also reflect a more robust measure of market rates that FTR adopted in the spring of 2018. Directionally, the old and new TCI are largely correlated since mid-2016, but the updated TCI shows peak conditions occurring earlier in 2018 than the prior metric. Moreover, that peak range was not as strong and was shorter than previously indicated.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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MVT Solutions offers no cost fuel efficiency reports

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Fleets currently relying on MVTS results include Hirschbach Motor Lines, Penske Truck Leasing, Nussbaum Transportation, Mesilla Valley Transportation, C.R. England and Charger Logistics. (Courtesy: MVT SOLUTIONS)

LAS CRUCES, N.M. — MVT Solutions, a provider of fuel economy testing and design and development services for the trucking industry, Thursday said that the test reports for its Certified Products are now available on a no-cost subscription basis.

“Receiving MVTS Certification is a mark of fuel efficiency excellence for a product and we feel strongly that the industry should have that information and the supporting test data in a timely manner and at no cost,” said Daryl Bear, lead engineer & COO at MVT Solutions. “In addition, the suppliers of the certified products have confidence that their results are being delivered by a trusted source to companies that are interested in their technologies.”

While MVT Solutions Certified Products’ Test Reports with the detailed test data on the latest fuel efficiency solutions for transportation companies are posted on the company’s website, the new subscription service ensures results are delivered automatically as soon as they are available giving fleets the ability to have the most up-to-date information, Bear said, adding that fleets currently relying on MVTS results include Hirschbach Motor Lines, Penske Truck Leasing, Nussbaum Transportation, Mesilla Valley Transportation, C.R. England and Charger Logistics.

Certified fuel economy testing by MVT Solutions was developed from race car engineering and advanced vehicle test methods using sensors and recording systems that collect data on fuel consumption, aerodynamics, rolling resistance, driver behavior and other variables that affect fuel consumption. The data is analyzed using proprietary methods.

Subscribing can be done via the MVT Solutions website or by following the company on LinkedIn.

MVT Solutions test reports for custom and developmental testing done for fleets or suppliers are released only with the permission of the company and are not part of the subscription service.

 

 

 

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