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March 16, 2008 10:45PM
http://news.rgj.com/apps/pbcs.dll/article?AID=/20080314/NEWS18/80314054&oaso=news.rgj.com%2Fbreakingnews

Truck firms fuming about high gas prices

With 12 years experience running a trucking company, Chad Bowen thought he’d seen it all.

But in the past year, the owner of Bowen Enterprises Inc. in Sparks said he’s witnessed something he’s never seen before.
“For the first time, we’ve actually paid more for fuel than we have for our drivers,” said Bowen, whose company boasts a fleet of 40 flatbed trucks and 25 refrigerated trailers.
“In the past, we’ve always budgeted more for our drivers than we have for fuel. But now the cost of fuel far exceeds the cost of a good employee. It’s just insane.”
As diesel prices accelerate to record levels, U.S. truck operators such as Bowen are fuming about skyrocketing fuel costs. In the past month alone, the cost of diesel jumped from an average price of $3.383 per gallon in February to a new high of $3.938 per gallon Friday, according to AAA’s daily fuel gauge report. The average price of diesel a year ago was $2.744 per gallon.
Truckers in the West are especially affected, given the region’s traditionally higher fuel prices compared to the rest of the nation. California, the top destination for Nevada’s trucks, according to the Bureau of Transportation Statistics, has diesel prices topping $4 per gallon in most metro areas, according to AAA. For Nevada truckers refueling in those places, that makes an already big problem even worse.
While fuel prices continue to climb, many truckers now find themselves running close to empty, with several operating on razor-thin profit margins or even at a loss in an attempt to ride out the storm while preserving their market share, said Paul Enos, chief executive officer of the Nevada Motor Transport Association. Others are simply getting out of the business..............

...................Fuel remains the biggest concern among the various costs for trucking.
Surging crude oil prices, which recently reached a record of $111 per barrel, have been singled out as the main culprit. In June 2002, diesel cost only $1.286 per gallon, according to the Energy Information Administration. At the time, the price of crude accounted for about 44.7 percent of the price of diesel while taxes accounted for 37.5 percent of the price. These days, crude accounts for more than 62 percent of the price of diesel while taxes make up about 14 percent of the price. Refining, which made up 6.6 percent of the cost of diesel in June 2002 now makes up anywhere from 14 percent to 24 percent of diesel prices depending on the time of year.
With diesel prices more than tripling in the last six years, fuel cost is now surpassing labor as the No. 1 cost for many carriers, said Tiffany Wlazlowski, director of public affairs for the American Trucking Associations. In 2002, the industry spent $44.7 billion on diesel. Last year, the trucking industry spent $112 billion for diesel and is on pace to spend a record $125 billion in 2008.
“We’ve seen record highs for three straight weeks, all double-digit increases,” Wlazlowski said. “In the past month alone diesel prices have increased over 50 cents per gallon. To put it in perspective, a one-penny increase in the price of diesel annualized over an entire year costs the trucking industry an additional $381 million a year.”............

................With truckers now operating at profit margins around 2 percent, that doesn’t leave much room for truckers to absorb extra costs from high fuel prices. Ultimately, consumers will start paying the price if fuel continues its skyrocketing cost.
“Look around your office,” Enos said. “Can you see anything that wasn’t delivered on a truck? Even tap water uses chemicals that have to be delivered by truck. So, there’s an escalating factor from increased fuel prices on everything we buy whether it be a computer or a can of beans.”
For truckers such as Packer, just seeing a light at the end of the tunnel would suffice. Looking at recent trends in fuel prices, however, that light seems to be many miles away.
“Fuel runs this country,” Packer said. “And truckers need reasonable fuel prices to stay in business. I already think we’re paying a dollar too much per gallon. It has to stop at some point, but the price of fuel just keeps going up and up. Everybody’s hurting right now.”....................

Truckers may be fuming, and think that current diesel prices are " unreasonable ", but the prices are reflecting the fast changing realities that are being precipitated by a world that will have to get buy on less and less energy supplies. On CNN's Sunday economic segment, an energy " expert " said that the current run-up of oil prices had nothing to do with any problems with supply and demand issues. With utterly clueless experts such as these feeding the US population such BS as this, is it any wonder that the mass majority of the American people still think that there is no " supply " problem regarding world energy, and that their travails in terms of having to pay high prices for energy, food, and everything else that cheap abundant fuel has provided for is just a matter of the politicians coming down hard on US Big Oil, and telling them to straighten up and bring those prices down. 60 to 70 years ago that might have worked, but things are completely changed now, such that the US government and US Big Oil can no longer control energy prices to any meaningful extent. We are entering a new paradigm of energy scarcity worldwide, and the goods will go to the highest bidder, or to the most beligerant and powerful regimes. Currently there is no light at all at the end of the tunnel of what we are facing regarding the inflationary price rise of all things related to energy availability.
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