Don’t expect diesel prices to drop anytime soon.

That’s what Bob Costello, chief economist of the American Trucking Associations, told an audience during ATA’s Management Conference & Exhibition in Charlotte, North Carolina.

“I’m not saying you’re going to see a big spike here, but I don’t think there’s gonna be much relief.”

The average price of a gallon of diesel fuel nationwide was $6.276 as of the Energy Department’s October 19 numbers, up nearly 10 cents over the previous week and $2.656 higher than a year ago.

California saw prices rise to $8.242 a gallon, up 15 cents from the previous week and $3.344 higher than a year ago.

The American Transportation Research Institute’s annual top industry issues survey, released during the ATA conference, found fuel prices were the number one concern.

It’s just the fourth time in the 22-year history of the survey that fuel prices have been on top of the list. First ranked as the industry’s top concern in the inaugural survey in 2005, the cost of diesel also topped the list in 2008 and 2022.

As one of the industry’s largest cost centers, diesel prices rise and motor carriers’ costs increase immediately, pressuring profit margins across all fleets, especially small- to mid-size fleets.

Why Are Diesel Prices So High?

Current distillate stocks are historically low for this time of year, which could signal higher diesel prices, Costello said.

“That does not bode well for the prices going into this fall freight season and later on this year,” he said.

And the continuing global oil crisis may get worse as countries run out of oil reserves to put into the market.

Costello pointed out that the previous week, on October 15, Brent crude oil prices reached more than $109 a barrel.

“I will tell you that that number should be closer to $130 a barrel,” he said. “And the reason it's not is because the U.S., and also other countries around the world, are dumping oil or had been dumping oil into the market.”

The Strategic Petroleum Reserve

But at the same time, last week, stocks of crude ​oil in ‌the U.S. Strategic Petroleum ​Reserve fell ​to 282.9 million ⁠barrels —  the ​lowest level since October 1982.

“We drew it down during the invasion of Ukraine, and then we were building it up a little bit, and then it's come back down,” Costello said.

But wait, the Energy Department says there’s still nearly 40% of the SPR’s maximum capacity.

“They can't take it to zero,” Costello said. “First of all, apparently some of the oil down in there is not good stuff, right? That it's been there so long that you wouldn't use it.”

On top of that, rapid drawdowns of the reserves stored in the underground salt caverns in Texas and Louisiana can thinthe salt walls and risk structural collapse.

“So we're about as low as we can get,” Costello said. “At some point, we’re going to stop putting more oil onto the open market, and we are likely to see an increase in the price of crude oil.”

And, while there are other factors affecting the price of diesel fuel, the price of crude oil is a major part of the price of a gallon of fuel.

Economist and podcaster Peter Schiff, in a social post on X, predicted that crude oil prices could hit $150 per barrel after the midterm elections.