Rising Diesel Cost Burning Up Truckers’ Pay
Posted March 3, 2008 11:50 p.m. EST
Updated March 4, 2008 1:24 a.m. EST
Raleigh, N.C. — The price of oil hit a record high Monday – over $103 a barrel. The cost of diesel fuel, used to transport the nation's goods, is also gushing at $3.67 a gallon nationally.
"By the time the end of the day comes, we might make a few dollars," said Don Proulx, owner of G & H Hauling.
Proulx's small trucking business has been hit hard by the rising cost of diesel fuel.
"If he (a trucker) had to drive any distance, at $3.75 a gallon for fuel, he just can't make any money," he said.
The price of diesel has also put the brakes on his brother's trucking business.
"You park them (trucks) when you have to and run them when you can," Ron Proulx said.
The cost of diesel has doubled over the past four years, causing take-home pay for truckers to plummet.
"I know, I myself have not received a paycheck from my company in over three months. It's either pay me or pay the other employees," Ron Proulx said.
The slumping dollar and tension in the oil-rich Middle East have been among the factors in crude's rise.
“I think the market is simply convinced that oil is becoming scarce, and we are still seeing increases in world demand, not just our country. But emerging economies like China and India are rapidly using more energy and therefore more oil,” economist Mike Walden said.
With the overall economy slowing, trucking companies are facing tough decisions.
"If the price doesn't come down, I'm going to have to shut down," Ron Proulx said.
The average U.S. price of a gallon of gasoline stood at $3.17 Monday, according to AAA and the Oil Price Information Service.
A month ago, the average price of regular gas was $2.96. A year ago, it was $2.37.
The Energy Department expects gas prices to peak at a record level near $3.40 this spring, and some analysts predict pump prices could rise to nearly $4 a gallon when the busy summer driving season arrives.