US diesel costs squeeze freight firms as New Zealand petrol tops NZ$4 a litre
Federal Reserve district accounts describe pressure on US trucking margins and grocery transport costs, while RNZ reports a sharp rise in New Zealand pump prices.
US freight firms are struggling with higher diesel costs, according to Federal Reserve district accounts reported by Fortune on 16 October, while motorists in parts of New Zealand faced 95-octane petrol prices above NZ$4 a litre the same day, RNZ reported. The separate reports show how fuel costs are reaching businesses and drivers in two different markets.
Diesel costs squeeze US freight margins
Average US diesel prices reached $6.30 a gallon on Wednesday, about 68% above their level before the Iran war, Fortune reported, citing AAA. Diesel is used across farming, manufacturing and transport, so higher prices can reach businesses well beyond fuel retailers.
Fortune reported that the Federal Reserve鈥檚 Beige Book described fuel surcharges across supply chains and pressure on profit margins. Contacts in the Cleveland district described higher fuel costs flowing into freight, packaging and petroleum-based materials. Some district contacts also reported consumers pulling back on spending, while others saw little change.
In the Richmond district, trucking carriers struggled to make a profit after diesel rose on contracts priced earlier, Fortune reported. Some drew down savings, reduced maintenance spending or stopped buying fuel-efficient trucks to cover the increase. A regional grocery chain told the district that diesel had risen 30% from a year earlier and that moving a head of lettuce from California now cost more than the lettuce itself, according to the Beige Book account quoted by Fortune.
Fortune also reported intermittent diesel shortages at some rural Colorado stations in recent weeks, based on Kansas City Fed contacts. US core consumer price inflation rose to 2.6% in September from 2.4% in August, the report said, as businesses passed on more costs. Some Fed contacts described workers seeking or receiving pay increases amid higher living and fuel expenses.
New Zealand petrol passes NZ$4 at some pumps
In Auckland, a BP station in New Lynn advertised 95-octane petrol at NZ$4.11 a litre on Friday, RNZ reported. Its 91-octane price was NZ$3.89. Fuel-price app Gaspy put the national average at NZ$3.80 a litre, up 11% over 28 days; RNZ reported averages of NZ$3.61 for 91-octane petrol and NZ$3.23 for diesel.
AA spokesperson Terry Collins told RNZ that a handful of locations charged more than NZ$4 a litre, with many others just below that level. He expected prices to stay high until at least Christmas. RNZ reported that ANZ identified exceptionally high freight costs and a weak New Zealand dollar as factors keeping fuel import costs elevated.
Economist Miles Workman told RNZ that refining margins, the New Zealand dollar, global oil prices and shipping costs offered little sign of near-term relief. He said the outlook toward year-end depended in part on the Middle East conflict, and that restoring lost production and rebuilding inventories could take time even if the conflict eased.
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Sources and context
- For one grocery chain, the cost to ship lettuce now tops the lettuce itself, showing how high fuel prices are sinking their teeth across the economyFortune
- Fuel price tops $4 at the pumpRNZ
AI-assisted article checked against the listed sources. NewsJaws did not conduct interviews or attend the reported events.