Record oil production is adding millions of miles for carriers hauling oil products
Have you ever heard anyone complain about low fuel prices? That rarely happens, of course, but low fuel prices do have an impact on transportation, trucking in particular. Lower diesel fuel prices drive down costs for carriers, and they often lead to an increase in economic activity.
But what really forces fuel prices down, and how does that actually help trucking? Low fuel prices are usually product of oil market supply and demand. Sometimes, political forces can play a role as well. Regardless, the result is a series of related events that affect transportation companies that work in the oil fields.
Generally, low prices occur during times of low demand or oversupply. In the most recent case, it is a supply push by U.S. companies that is helping drive down prices worldwide but is driving up transportation-related revenue.
The U.S. is now pumping more oil than ever before, according to Baker Hughes, which tracks oil rig count. According to the company, the U.S. now has 712 operating oil rigs. Each rig added can add thousands of truckloads of product to the industry. Even as OPEC nations curtail production to try and drive up prices, the U.S., thanks in large part to hydraulic fracking, continues to increase its production levels.
