Diesel Eases From Record as Truckers Await Details of Federal Dyed-Diesel Order
The national average price of on-highway diesel fell for a second straight week to $6.199 per gallon for the week of Oct. 5, according to the U.S. Energy Information Administration. That was down 18.3 cents from the prior week and 33 cents below the record $6.529 set the week of Sept. 21, the highest reading in an EIA weekly series that dates to 1994. Prices remain $2.49 higher than a year earlier, an increase of 67%. Prices declined in every region the EIA tracks. California averaged $8.082, the highest, and the Lower Atlantic region was lowest at $5.699.
Diesel averaged $3.459 the week of Jan. 12, then jumped 96 cents the week of March 9, the largest one-week increase in the EIA series. It eased to $4.578 by early July before climbing again through September.
Jay Gustafson, chief capacity officer at Echo Global Logistics, said rising diesel is one reason truckload rates are up year over year for most customers in 2026. He said customers feel it through the fuel surcharge tables in their procurement process, and those that secure capacity on the spot market feel it because fuel has a direct effect on spot pricing.
“The rising cost to operate equipment, coupled with the supply driven market shifts are collectively creating a volatile 2026,” Gustafson said.
Gustafson said rising diesel prices put increased pressure on small fleets that lack strategies to reduce fuel costs. “While many carriers are able to negotiate rate increases as fuel spikes, those rate increases often lag the direct increases in cost they see at the pump,” he said. “This can result in carriers absorbing significant costs as the market drastically changes.”
The quarterly Diesel Fuel Index from Magnus Technologies, released Sept. 17, found that carriers on quarterly surcharge resets had been shielded through most of the summer because their rates were still tied to the second quarter’s elevated average. The report said that protection would thin as resets moved into the fourth quarter. A simple average of the EIA’s 13 weekly readings for the third quarter is about $5.56 per gallon, 64 cents below the Oct. 5 price. In the company’s July diesel snapshot, Magnus founder and CEO Matt Cartwright said a lagging surcharge can leave carriers absorbing unrecovered costs when fuel rises, while “falling prices can create the opposite problem.”
On Oct. 5, President Donald Trump signed an executive order directing the Treasury secretary to determine within five days whether federal law allows deferral of certain diesel excise taxes incurred from Oct. 5 through Dec. 31. The order also directs the IRS to announce it will not penalize the highway sale or use of dyed diesel, which is normally limited to off-road use, during the same period. Deferred taxes would come due on a date set in Treasury guidance, and the order directs Treasury to explore ways, including legislation, to eliminate them. The federal highway diesel tax is 24.4 cents per gallon. As of Oct. 13, the IRS had not posted the penalty announcement on its newsroom. At least 11 states had issued their own dyed-diesel relief, CCJ reported.
Todd Spencer, president and CEO of the Owner-Operator Independent Drivers Association, said in a statement reported by The National News Desk that “OOIDA believes allowing the wider use of red-dyed diesel will provide minimal relief.” University of Houston energy economist Ed Hirs told the outlet he expected only a marginal break in retail diesel costs for truckers, and shortages of red diesel at first as large companies’ fleets compete with farmers for the same supply.
Gustafson recommended that carriers of all sizes use fuel card programs, which he said now offer discounts that were historically available only to the largest fleets, and digital load-matching tools that reduce deadhead by finding transactional and recurring freight in markets where trucks have capacity. He cited Echo’s own fuel card program and its EchoDrive carrier platform as examples.
For rate negotiations, Gustafson said both sides should keep fuel separate. “Whenever possible, it is recommended that both customers and carriers utilize fuel surcharges when negotiating rates,” he said. “Both parties should avoid locking in ‘all in rates’ that do not account for adjustments in fuel, as large changes in fuel costs can create pressure for both parties.”
The EIA’s October Short-Term Energy Outlook, finalized Oct. 1, put September’s retail diesel average at $6.29 and forecasts an average of about $4.50 in 2027. The agency said East Coast distillate inventories were 32% below their five-year seasonal average in September and expects them to remain about 20% below the 2021 to 2025 average through the coming winter.
