Diesel fuel won’t be “gone” by Thanksgiving, but it will likely be more expensive
Good morning! First things first… massive apologies for referring to yesterday as “Taco Tuesday”. Our editor was thrown off by Halloween being a Monday and had a slip-up…
But hey, tacos are for every day - right?
There have been some confusing headlines that have led some to panic - but here’s the good news. No, the United States will not be “out of diesel fuel” by Thanksgiving. However, that isn’t meant to downplay the seriousness of depleting reserves. The U.S. Energy Information Administration (EIA) measures reserves based on if all U.S. refineries ceased producing distillates completely and all imports were put on hold. This move… is extremely unlikely to happen.
But yes, diesel is about to get more expensive.
Check out today’s featured article from Trucking Info to read about why depleting diesel stockpiles will result in higher prices, and why there is no reason to be considered about a lack of diesel by Thanksgiving. You’ll just be paying more for it. ☕️
Featured Article:
No, We Aren’t Running Out of Diesel — But Low Stockpiles Mean Higher Prices | Trucking Info
“While stockpiles of distillate fuels (diesel and heating oil) are low, the country is not going to suddenly run out of diesel fuel by Thanksgiving, despite reports of a “diesel shortage” driven by a widespread misunderstanding of a government statistic.”
Artificial Intelligence & Cab Tech 🚛
Self-driving trucks are being held back by growing concerns over AI startups
Investors and corporations are being more “careful” than ever as economic conditions worsen and fully autonomous commercial cars are being called into question. Argo AI - Ford and Volkswagen’s joint venture - shut down last week and there has been a litany of lawsuits filed against Tesla regarding “autopilot” claims. Investors are switching up the approach to automation, and instead now focusing on driver-assist functions instead go full autonomy.
Private equity and venture capital dollars are needed for full implementation of automation, and it seems that those companies are believing that while still possible… it’s still several years away from becoming mainstream. The freight trucking sector is continuing to run pilot tests on highway routes before passing the last-mile delivery off to human drivers. However, the pressure to adapt quickly is weakening.
Midterm Elections 🇺🇸
Voters remain gloomy despite recent economic gains | Politico
In this article, Politico contributor Brittany Gibson writes about the lack of voter enthusiasm despite U.S. economic growth and slightly lower gas prices.
Insider contributor Juliana Kaplan writes about the devastating timing for Democrats approaching midterm elections as most Americans have some major concerns about the state of the economy.
Biden pitchman Landrieu hawks infrastructure and hope | AP News
In this article, AP News contributor Josh Boak writes about Mitch Landrieu, the former New Orleans mayor and the Biden Administration’s infrastructure coordinator, who has been promoting the $1 trillion infrastructure plan across the nation.
Company Culture & Railroads 🚂
With a rail strike possible by November 19th, the industry waits with bated breath
Rail negotiations between the union workers and the railroads have been like a yo-yo. With a strike narrowly avoided in September, it seems we are near square one. The presidential emergency board assisted initially, recommending a proposal between the disagreeing parties. However, paid sick leave seems to be the lynchpin.
Two unions - The Brotherhood of Maintenance of Way Employes Division of the International Brotherhood of Teamsters and the Brotherhood of Railroad Signalmen - have rejected the tentative deal brokered by the White House’s arbitrators. Without an agreement in place, labor actions could begin as soon as November 19th. Four unions have yet to hold votes on the matter - The International Association of Machinists and Aerospace Workers District 19, The International Brotherhood of Boilermakers, The Brotherhood of Locomotive Engineers and Trainmen, and The SMART Transportation Division.
Let’s Get Global 🌎
Bridesmaids Help Me Im Poor GIF via GIPHY
🚢 Shippers across the world are now demanding discounts from ocean carriers. Due to spot market rates declining after years of unprecedented growth during the COVID pandemic boom, carriers are asking if they can keep the profits rolling in. Without a pivot, some maritime experts at Drewy are claiming that the industry is doomed to return to a low-margin pre-pandemic trend if an opportunity is missed. From Q2 2020 through Q2 2022, ocean carriers raked in approximately $400 billion in profits.
🇩🇰 Denmark-based Maersk is reporting nearly $9 billion in profits. With a recorded 2022 revenue of over $22 billion, the ocean logistics company is reporting higher volumes as compared to last year. Søren Skou, CEO of Maersk, advised that this was the company’s 16th quarter in a row reporting year-on-year sales growth. They also noted that there were challenges ahead for the company and the industry as a whole, but Maersk will continue to “pursue growth opportunities”.
✈️ Europe’s airports have been on sale, improving airport productivity. In a small sample of sixteen privatized airports, the National Bureau of Economic Research (NBER Working Paper 30544) analyzed 437 privatized airports. In this study, they reviewed airport performance and concluded that overall passenger numbers increase by 84% under infra-fund ownership. the number of airline routes - particularly international routes - also jumps in number.
iLevel With You
More topics for the average American household to consider…
🎁 Retailers have an overstock problem and they need consumers to help. Overstock strategies are expected to be abundant this holiday season, as retailers discount their surplus inventory and pour their better quality “secondary market” items into the hands of willing consumers. Secondary market items are typically those that are used or open-box - but this year, there may be more new items on the floor. E-commerce-based marketplaces such as Amazon, Wish, and eBay are likely to take this route and physical stores such as Ross and Burlington Coat Factory will be offering an abundance.
🌬️ Offshore wind farms may not be the quick energy solution the U.S. hoped it would be. President Biden’s plans to power 10 million American households via offshore wind farms are starting to run into trouble. Major backers for several proposals, including the New Jersey utility Public Service Enterprise Group Inc. and New England utility Avangrid Inc., are pulling out due to supply chain constraints and inflationary challenges that are increasing the costs associated. Timothy Fox, vice president of the Washington-based energy research firm Clearview Energy Partners, has suggested that plans for offshore wind projects will continue to be heavily delayed as sky-high interest rates and inflation prohibit operations.
🫣 Is the supply chain taking one step forward, and two steps back? While progress has been made in untangling the web of supply chain issues over the past two years, geopolitical tension and potential industry strikes are just some of the newest debacles facing down the sector. The New York Federal Reserve’s global supply chain pressure index has dropped to its lowest level in almost two years and positive recovery has been hampered by instability. Sergio Gutierrez, CEO of freight logistics firm RPM, has warned that the days of stability per-pandemic are now behind us, and supply chains are likely to take some time to fully recover.
GET SMART
Ramp up that brain power for these advanced topics…
📉 October numbers represent a slowdown in the logistics sector. The monthly Logistics Manager’s Index (LMI) report, released on November 1st, shows a 57.5 reading - the lowest since May 2020. Any reading above 50 is generally read as “growth” while under 50 indicates a contraction, but with the reading hovering between the 60s and 70s for the past two years… it’s clear the downtrend is steady. Transportation markets have dampened and massive stocks of inventory are driving up the costs. Inventories did slow in October compared to previous months but still continued to grow.
🫡 When facing volatile market conditions, vendor collaboration can make a difference. Companies typically focus on their own sales and margin rates when navigating through a challenging business season, but when a company also incorporates the success of its vendors, they are more likely to thrive. By focusing on vendor collaboration when forecasting, companies can plan specific promotions and marketing campaigns for their customers, meet long-term demands by analyzing patterns, and enable real-time visibility for the status of any pending purchase orders.
🔧 U.S. manufacturing growth was flat in October, reports the Institute for Supply Management. Formulated by a group of surveyed business executives, the ISM’s Purchasing Manager’s Index report released indicated that there is slow growth in the overall manufacturing economy. Respondents of the survey referenced slowing demand and growing concerns of a recession as reasons for the flatlining. Customer demand has been a wet blanket on the sector as consumers pull back on spending amid rising interest rates.
Regulations ⚖️
Freeport LNG Hasn’t Filed Plan to Regulators as Export Restart Date Looms | Supply Chain Brain
In this article, Supply Chain Brain contributor Bloomberg shares an update about Freeport LNG’s current lack of a restart plan. Federal Regulators require this plan before operations begin after being shut down in June due to an explosion on the site.
New national port improvement plan will also benefit truck drivers | The Trucker
In this article, The Trucker News Staff writes about The U.S. Department of Transportation’s (USDOT) decision to fund 41 projects through 22 states with $703 million.
Electric Vehicles 🔋
NACFE sets sights on electric depots for next Run | Fleet Owner
In this article, Fleet Owner’s contributor Cristina Commendatore writes about The North American Council for Freight Efficiency’s plans to expand its Run on Less—Electric Depot program.
Fuel ⛽️
Surging diesel prices 'really hurting' small trucking outfits: Bart Plaskoff | Fox Business
In this video, Fox Business 'Varney & Co.' interviews Summit Trucking president Bart Plaskoff regarding challenges with rising diesel prices.
Report: Number of Employed Diesel Techs Increases | Trucking Info
In this article, Trucking Info contributor Verna Brajkovic writes about the growing number of technicians. combatting the shortage.
Business Strategy 💡
Six future motor freight trends | Logistics Management
In this article, Logistics Management Editor Bridger McCrea writes about a few of the growing trends we can expect from motor freight shippers and carriers over the next several months.
Is the New Era of 3PLs Working For You? | Flexport
In this article, Flexport’s Editorial Team writes about the growing 3PL sector and whether it’s a segment most can get behind in the trucking and transportation industry.
XPO Logistics completes brokerage spinoff | Transport Dive
In this article, Transport Dive Reporter Colin Campbell writes about RXO. XPO’s standalone North Carolina-based brokerage company.
Safety 🦺
Vision Zero goals will involve more than tech alone | Truck News
In this article, Truck News contributor John G. Smith writes about the challenges associated with the goal of eliminating traffic-related deaths and serious injuries on the roadways.
Industry Indicators 📉
In this article, CNBC’s Elliot Smith writes about the warning issued by Maersk regarding global trade.
The Workday Dash is an aggregation of articles regarding the transportation logistics, trucking, and supply chain industries for November 28, 2024, from iLevel Logistics Inc.