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As diesel prices climb and supply chain uncertainty deepens, shippers are rethinking their transportation strategies—and the math is increasingly pointing in one direction. The Rising Cost of Fuel: Why Intermodal Transportation Just Makes “Cents”
I f you’ve been watching your freight bills climb, you’re not imagining it. Global fuel markets are in a period of significant volatility, driven by a combination of macroeconomic pressure and geopolitical instability. The disruption in energy supply chains has added risk premiums to oil and diesel markets worldwide, reaching the dock doors of shippers and receivers across all shipping modes in North America. For supply chain managers, this isn’t just an abstract economic headline. Fuel is one of the largest variable components of freight costs, particularly for over- the-road truckload shipping. As diesel prices rise, fuel surcharges climb in lockstep with total transportation spend. The question facing shippers today isn’t whether fuel costs are going up. It’s what they’re going to do about it.
• Lower cost per mile on longer haul lanes • Improved sustainability through reduced fuel consumption • Greater cost stability during periods of economic uncertainty A Smarter Way Forward A lane-by-lane evaluation can pinpoint exactly where intermodal offers the best combination of cost efficiency and service performance, while factoring transit time requirements, origin and destination proximity to intermodal ramps, and freight characteristics into the modal conversion decision. But for shippers who haven’t recently revisited their lane mix through an intermodal lens, the current fuel environment makes that analysis more urgent—and potentially more rewarding—than it has been in recent years. By working with an award-winning, experienced transportation and logistics solutions provider like Hub Group, shippers will receive the guidance to make an informed decision specific to their supply chain to help mitigate costs without sacrificing service and reliability.
intermodal’s exposure to diesel price swings is structurally lower. Fuel surcharge increases are more gradual, and base rates are less sensitive to short-term price spikes. The result: As fuel prices rise, the cost gap between truckload and intermodal widens—sometimes substantially. The Widening Gap The impact of this dynamic becomes clearest when you look at long-haul lanes. The cost spread between truckload and intermodal grows significantly as the price per gallon rises. Fuel efficiency compounds over distance. The longer the haul, the more miles rail is doing the heavy lifting and the greater the savings. For shippers with significant freight volume moving across the country, the fuel cost advantage of intermodal isn’t just real; it scales in their favor. The Strategic Case for Intermodal Goes Beyond Fuel Savings Cost is the most immediate argument for intermodal in a high-fuel environment, but it’s not the only one. Shippers who evaluate intermodal seriously find a range of benefits that hold value even
Not All Transportation Modes Feel the Pain Equally
Here’s the critical distinction that many shippers overlook when fuel prices spike: Truckload and intermodal transportation don’t respond to diesel price increases in the same way. Truckload transportation is heavily diesel dependent. Fuel costs represent a significant share of total linehaul expense, and when diesel prices jump, fuel surcharges increase quickly and dramatically. For shippers moving freight over-the-road, every tick upward at the pump translates almost immediately into a higher freight bill. Intermodal transportation combines rail and truck service, operating on a fundamentally different fuel equation. Rail is significantly more fuel-efficient than highway trucking, which means
–By Jessica Pokrajac
Executive Vice President, Managed Transportation and Customer Solutions Hub Group info@hubgroup.com
when diesel prices moderate: • Reduced exposure to fuel price volatility • More predictable fuel surcharge behavior
hubgroup.com 800-377-5833
20 Inbound Logistics • May 2026
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