Little movement in Contract Load Accepted Volumes week-over-week. Still slightly above 2020 volumes and about 1000 bps below 2021 figures.
Compared to the OTVI, the shift from spot to contract-heavy freight flows remains the narrative as the OTVI is performing well below ’20 and ’21 figures as it SLOWLY approaches 2019 numbers.
According to DAT’s Trendlines, van and reefer spot rates fell week-over-week, month-over-month, and year-over-year for this week’s release.
Flatbed remains out of negative territory year-over-year at 6%, however fell week-over-week and month-over-month at 2.3% and 4.3% respectfully.
The diesel at the pump national average continues to fall – down to $5.08/gallon. March was the last time we saw diesel costs this low.
Since its peak in June, the average has fallen about $80 cents/gallon and remains on a steep downward trajectory, mostly due to increased production domestically, significant withdrawals from petroleum reserves, and reduced haul lengths as east coast ports become more and more desirable.
The down tick taking place at the same time as seam bursting inventories have collided with a slowdown in retail consumer demand, creating a window of opportunity for sluggish intermodal solutions.
The question remains: how long will fuel costs continue to decline? And is this only a brief season of energy deflation?
As petroleum processing facilities continue to operate at unsustainable levels, hurricane season beginning, potential natural gas restrictions from Russia requiring the EU to explore other means of energy – further offsetting the fragile oil supply and demand imbalance – and both the release of barrels from the Strategic Petroleum Reserve ending this fall, and the eventual need for replenishment.
I think it goes without saying that there are a number of events that could end this season of relief but only time will tell!
This has been your Bridge Logistics Market Update for the week of August 15, 2022.