A B&K Distributing employee finishes filling the diesel gas tank on a commercial vehicle at the Petro West gas station in Steamboat Springs on Friday afternoon.

Photo by Brian Ray

A B&K Distributing employee finishes filling the diesel gas tank on a commercial vehicle at the Petro West gas station in Steamboat Springs on Friday afternoon.

Diesel prices slam businesses

Record-high fuel costs pain truckers, other industries

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— Diesel fuel prices are higher than ever, and businesses are feeling the burn.

Across Steamboat Springs and Routt County, diesel fuel costs more than $4 a gallon. A year ago, the state average was about $2.98, according to AAA.

"It's crazy. It's totally crazy," said Don Hayes, who owns Hayes Trucking in Hayden.

He said the soaring prices are cutting into his bottom line.

The state average for diesel was $3.975 a gallon Friday, which was the highest price on record, according to AAA. The national average was $4.02 a gallon.

"Even on local trucking, if you're staying within a 220-mile radius, the jobs that we were doing a month ago for $243 in fuel are now costing us $279 to $285," Hayes said.

The costs are going to hit consumers eventually if they aren't already, trucking industry experts said. Some independent truckers went on strike or decreased their speeds last week in protest, but local truckers said they were not involved.

The strike was limited, said Larry Daniel, president of America's Independent Truckers' Association.

"There were certain pockets around the country where people did it," Daniel said. "We did not promote the strike at all. We know that for a trucker to make money, he's got to be rolling down the highway. He's only got a certain number of hours a day he could drive. During that time, if he weren't driving, he should've been."

Easing the burden

Daniel's Mississippi-based group provides resources for independent truckers. Diesel costs are putting a major squeeze on those independents, he said. That's partly because customers aren't required by law to pay a fuel surcharge to truckers when diesel skyrockets, Daniel said.

Truckers can ask for the surcharge. Customers can say no, he said.

"The government should step in and mandate a fuel surcharge and create a formula to calculate it," Daniel said.

Greg Fulton, president of Colorado Motor Carriers Association, said the government could help by releasing some of its strategic oil reserves. He also said the government should fund or provide incentives for fuel-saving measures.

Trucks usually sit idle and burn fuel when truckers stop for rest and keep the heat or air conditioner running, Fulton said. Idling uses about a gallon an hour, he said. Auxiliary power units are available as alternatives to fuel, he said.

But those measures aren't cheap.

"An auxiliary unit costs $8,000," Fulton said. "If you could provide owner-operators with a tax credit or whatever to allow them to get into that and save that, we think that has some possibilities."

State requirements for fuel also factor into the price, truckers said. California laws mandate cleaner diesel, Hayes said, which increases refining costs. Those are passed to truckers at the pump.

The issue is a hot one for Hayes, who owns three trucks and leases about a half-dozen more. With fuel taxes, license plates, insurance and other expenses, he said it costs nearly $56,000 a year to run a single truck in Routt County.

Hayes also advocated government action.

"Every one of our congressmen and senators has got a phone number," he said. "Keep an eye on 'em; call 'em."

Other fields feel pinch

High diesel prices harm a slew of industries, businesses said.

"It affects everyone, I think, in every phase - any petroleum product at all," said Rod Scott of Native Excavating in Steamboat. "I can tell you this much, that we've actually had to increase what we are paying. We use a lot of lease trucks besides our own, and we actually had to bump what we're paying lease trucks. In turn, we're going to have to bump what we're charging customers."

Scott predicted that high diesel costs would affect growth in Steamboat.

"Asphalt paving is a big petroleum product; it's made from asphalt cement, which is a petroleum product," Scott said. "That'll be another big area. : If you're building a subdivision and you have to pave the road, you're going to pay more money for it."

Costs also are increasing for ranchers and farmers, Saddleback Ranch owner Wayne Iacovetto said. His ranch caters to tourists and also raises thousands of cattle. It's tough for ranchers, Iacovetto said, because they can't just raise and lower prices when costs increase.

"With the commodities market, it goes off supply and demand," he said. "If our price of production goes up, you can't just say I'm going to raise the price of my commodity."

Most of the ranch's diesel costs go toward feeding cattle this time of year, he said. Because Saddleback also is in the recreation business, Iacovetto said the ranch has to pay for diesel for buses and snow-clearing machines.

It hasn't been easy, he said. Prices have gone steadily up and show no sign of decreasing.

"Everybody's affected by it," Iacovetto said. "Every product you buy has been created somewhere. It's kind of wild. It's getting out of hand."

- To reach Blythe Terrell, call 871-4234 or e-mail bterrell@steamboatpilot.com

Comments

MtnWarlock 6 years, 8 months ago

Ah yes. This is one of the major contributors in our economy situation. Everything we do has a fossil fuel connection! Keep your eyes on the foreign markets, especially China and their demands for energy! There is one of our problems. It's going to get worse before it gets better! Housing is another cumulative problem that contributes to our national economy. I just hope we don't see double digit inflation like the 1980s. A new recession could last a decade or more!

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colowoodsman 6 years, 8 months ago

OH NO! Don't tell me B&K is going to raise the price of beer! That could cause Tripple Crown to pull out and our entire economy will collapse!

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jezilu 6 years, 8 months ago

Mtn Warlock Where have you been? I have missed your insightful commentary. I thought you might have flown the 'boat now that the ski season is over.

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MtnWarlock 6 years, 8 months ago

jezilu, Naah! This is a good time to stay in Steamboat! I get to see all the folks I don't get to see when the ski season work load is on. Besides, I'm not one of those who have the privilege or the funds to escape all the time. I still have to stay and work. I've been posting!

colowoodsman, Gee, I hope the price of our fine barley buddies don't increase too much! I may have to switch to drinking a lesser quality of beverage! No, wait! I already do! My vehicle drinks all the quality liquids of consumption now!

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Tom3 6 years, 8 months ago

"We are addicted to oil" - The only rational and sane thing that Chimpy has said in the past 7 years.

I bet his handlers blew a fuse when he said that. After all, he was telling an inconvenient truth, which his Big Oil overlords do not want us to hear.

We ARE addicted to oil. Our economy runs on Diesel. Trains, trucks and even airplanes (jet fuel is fancy Diesel) run on the stuff.

Look at the food in your kitchen or on your plate at the restaurant. The average distance it travelled to your plate is 1400 miles. That's a long way.

Our economy is addicted to diesel and when the price goes high enough, our economy will COLLAPSE.

Then you will need to find your food a bit closer to home.

I blame Chimpy and the Repukes for this mess. If Al Gore had been given the Presidency he rightfully deserved, we would be well on our way to beating this addiction.

Instead, 59 Million Morons voted AGAIN for the Chimp and his incompetent and destructive policies.

Worried about the price of Diesel? If you voted Repuke, it is YOUR FAULT.

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handyman 6 years, 8 months ago

You mean Al Gore didn't invent the internet?!?!?!

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MtnWarlock 6 years, 8 months ago

sbvor, Good job as usual with your linking's!

Tom3, It's obvious you hate the current administration and republicans and that's ok! However, both partisans Democrats and Republicans, have a hand in the impacts of oil business, just like they do with health care in this country! In my opinion, Washington in general, with their lobbyists and kick backs, is wrong in a lot of ways! I guess it just depends on what you believe in or what you want, that makes it all ok! Some may go to the extent to accuse them of being down right criminal! Then again, maybe they are a reflection of the people because, a majority voted to put them there! We often express our feelings with the facts in this blog. I would say you have a lot of emotion going on today! No need to get your undies in a bunch about Al Gore, he's doing better not accupying public office! So are the Clintons! Presidential pay is not something you get rich on. Have a good day and thanks for the contribution! I'm glad we live in a country where we can express our views without being shot between the eyes!

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powderman 6 years, 8 months ago

ha ha yep. he lets other peoples work do all the talking for him, and who honestly clicks on all his links?

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