In The News
Lawmakers to examine effect of surging diesel prices, where fuel surcharges go
WASHINGTON — Record diesel fuel prices already have prompted truckers to protest on Capitol Hill and to ask the government for help.
On Tuesday, lawmakers will examine the relationship among motor carriers, brokers, shippers and independent drivers regarding the establishment and collection of fuel surcharges.
The House subcommittee on highways and transit is scheduled to hear from truckers, petroleum industry representatives, a Wall Street analyst and others about the effects of record diesel prices on the industry.
Among those scheduled to testify are: John Felmy, chief economist at the American Petroleum Institute; Todd Spencer, executive vice president of the Owner-Operator Independent Drivers Association; and Ryan Todd, integrated oil analyst with Deutsche Bank AG.
The witnesses also are expected to offer opinions on legislation that would require any fuel surcharge to be passed through to drivers. Independent truckers argue that a current lack of disclosure requirements makes it difficult to ensure the surcharge benefits those paying more at the pump.
Diesel prices dipped slightly overnight to a national average of about $4.24 a gallon Monday, but remain near the record high of $4.25 per gallon set last week. Prices averaged $2.92 a gallon a year ago, according to AAA and the Oil Price Information Service. Meanwhile, light, sweet crude for June delivery broke the $120 a barrel barrier for the first time during Monday trading on the New York Mercantile Exchange.
Diesel is used to power most trucks, trains and ships, and the run-up in prices is one reason why food and other costs also have spiked in recent months. Trucks haul 70 percent of all freight in the U.S., according to an industry trade group.
Truck drivers last week honked horns and shouted through bullhorns at the U.S. Capitol to protest rising fuel prices. They have urged Congress to end large oil company subsidies and release fuel from the Strategic Petroleum Reserve, among other things.
The American Trucking Associations, whose members include United Parcel Service Inc. and Knight Transportation Inc., has said it now costs more than $1,000 to fill a typical tractor-trailer, and that the nation's 3.5 million truck drivers are on pace to spend a record $135 billion on diesel fuel this year, up $22 billion from 2007. The ATA in March asked President Bush to release oil from the Strategic Petroleum Reserve to help offset record diesel bills.
But the White House has repeatedly rejected similar requests from some in Congress, saying the reserve is to be used only to counter a severe disruption in supply, not in reaction to prices.