Who Benefits from Lower Fuel Costs?

Posted 3 years ago

Who Benefits From Lower Fuel Costs?

trucking fuel costsIt’s one of the hot topics of conversation, second only to the weather! Here are the TOP 4 variations on the discussion:

4/ Hurray for lower fuel costs! After the exasperating and seemingly endless hikes at the pumps, we are now basking in the delight of gasoline below a dollar per litre. Who would ever have imagined a couple years ago that such prices would precipitate a mad dash to the local fuel distributor? Our only hope is that they continue to decline.

3/ Why aren’t they dropping faster? Even seasoned economists have a hard time predicting the future for petroleum products, given the many factors affecting the industry. However, an obvious major reason is the production of petroleum due to hydraulic fracturing and off-shore drilling in North America. In spite of the unrest in the Middle East that formerly jacked oil-per-barrel prices up, these newer sources have actually created an excess in the market. According to the well-known law of supply and demand, this will inevitably result in lower prices. It does take time for reduced cost per barrel of oil to trickle down to the customer; patience and faith that economics will prevail over human avarice should reward us with yet lower prices for awhile yet.

2/ How are lower prices at the pumps affecting trucking prices? Although diesel fuel prices have been uncharacteristically higher than gasoline in the past few years and remain so, they are falling as well. Because fuel costs comprise the largest single expense for trucking transportation, overall costs should become significantly lower. Increased consumer spending due to savings at the pumps will create greater demand for transportation of retail goods as well. This is great news for trucking companies!

1/ Will patrons of trucking companies reap the benefits in the long run? The answer is a resounding “Yes!” As your trucking experts begin to find some relief in their transportation costs, their clients will enjoy the same. Trucking has taken the lead in desirable transportation of goods.

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