Earlier this month, a robber in Houston, Texas, hijacked a petroleum transport at gunpoint at a fuel terminal. The transport's driver reportedly had just finished loading a shipment of diesel. Fortunately, the truck driver came away unhurt.
Actually, it is somewhat amazing that fuel shipment hijackings aren't happening more frequently considering the current price of oil and the refined fuels that are made from it. With the value of a tank trailer load of diesel approaching $40,000, each shipment becomes an increasingly tempting target.
Even without hijackings of fuel shipments, soaring energy costs overall are having a profound impact on tank truck carriers (as well as truck fleets in general). Conditions are even worse for the owner-operators that many trucking companies have come to rely on for a sizable percentage of the tractors in their fleets.
The American Trucking Associations (ATA) is projecting record high diesel fuel costs in 2008, and prices neared $4.25 a gallon at the beginning of May. Diesel prices were under $3 a gallon last year at this time.
The trucking industry will spend approximately $135 billion on fuel in 2008, based on ATA's current fuel forecasts. This marks a $22 billion increase over the trucking industry's $112.6 billion fuel bill in 2007.
Bill Graves, ATA president and chief executive officer, said recently that the trucking industry is experiencing the highest prolonged fuel prices in history. For a growing number of truck fleets, fuel has begun to surpass labor as the biggest expense. That is truly frightening.
Further, that's just the tip of the energy-cost iceberg. Wash racks, transload facilities, and storage terminals that are part of the overall bulk logistics sector also are paying more for the fuels they use in boilers and other equipment. Everything made from petroleum costs more today, and that includes tires and product hoses.
The higher energy prices paid by truck fleets and the logistics sector don't affect just them. The entire economy is being impacted. Trucks haul 70% of all freight tonnage, which means rising fuel costs have already begun to increase the cost of everything transported by truck, including food, gasoline, retail, and manufactured goods.
This is a serious situation for the trucking industry, and the US economy in general. How in the world did we get in this fix? Where is the leadership — both in industry and government?
Lee Iacocca (former Ford Motor Company president and Chrysler Corp chief executive officer) addresses these issues in his new book “Where Have All the Leaders Gone?” He says: “Gas prices are skyrocketing, and nobody in power has a coherent energy policy. Name me a government leader who can articulate a plan for…solving the energy crisis. The silence is deafening.”
Iacocca goes on to write that we've got a “gang of clueless bozos steering our ship of state right over a cliff.” He says it's time to throw out all of the elected officials in Washington DC and start over.
It's a tempting thought. Too many Senators and Congressmen do little more than collect a paycheck. A good example of the legislative failure is the call for a gas-tax holiday by some elected officials. It's little more than a cheap political ploy that will do nothing to fix the problem.
Without question we need real leadership on the energy issue. We need action, and we need it now. We can't remain dependent on imports of foreign oil. We must achieve energy independence to protect the US economy.
All energy options must be considered. We need a basket of energy options that is large and diverse. That includes drilling domestic oil and gas wells in areas that are currently closed. Nuclear power must be part of the energy mix, along with wind and solar power. Renewable fuels have a big role to play.