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The International Energy Agency warned that constrained diesel supplies could last well into 2027, even as the U.S. average diesel price dipped for a second week. Bain & Company’s advice to shippers is to manage freight costs they can influence, including fuel-surcharge terms, transport modes, operating efficiency and inbound freight.
The International Energy Agency warned Tuesday that constrained diesel supplies could persist well into 2027, prompting Bain & Company to urge freight-intensive businesses to manage costs they can control rather than wait for prices to normalize. U.S. diesel prices fell for a second consecutive week, but the national average remained more than $2.50 a gallon above its year-earlier level, according to the Energy Information Administration.
The EIA put the U.S. average on-highway diesel price at $6.179 a gallon in the latest reported week, down from $6.382 for the week of Sept. 28. The two-cent decline offered limited relief against a steep year-over-year increase. The IEA said September refining margins reached nearly $95 a barrel after attacks linked to the Iran war cut refining capacity. The agency cited counter-seasonal stock draws and restricted production alongside peak winter demand as reasons supply could remain tight.
In a report published Oct. 1 with Spencer Shute, a vice president at Bain-owned Proxima, Bain expert partner Jim Horrigan set out four approaches for shippers: negotiate fuel-surcharge schedules and limits in carrier contracts; move freight suitable for it to rail; reduce wasted miles and idle time through better execution; and scrutinize inbound freight and supplier charges. Horrigan, who has more than 30 years of procurement and sourcing consulting experience, said companies have limited influence over diesel prices but can pay closer attention to freight expenses.
Fuel represents an estimated 25% to 30% of trucking operating costs, up from about 21% in 2024, Bain said. For a shipper paying $50 million a year in truckload base rates, Bain estimates changes in fuel surcharges could add $2 million to $4.5 million to the annual bill. The report recommends using weekly EIA diesel prices as a contract reference and setting limits on how often surcharges change and how large adjustments can be.
Freight Bills Face Prolonged Pressure
If diesel supplies remain constrained, freight buyers may face high and volatile bills beyond the immediate period, with fuel surcharges transmitting some of that pressure into transport costs. The latest U.S. price dip does not, by itself, indicate that the broader supply outlook has improved: the EIA figure is a weekly national average, while the IEA warning concerns supply conditions extending into the winter and potentially 2027.
Bain’s recommendations focus on limiting exposure rather than predicting fuel prices. Its estimates show why contract mechanics matter: a surcharge can continue to affect a shipper’s bill even if the underlying fuel price later falls, depending on how a carrier calculates and updates the charge. Alternative modes and operational changes may reduce costs, but they can involve service or scheduling trade-offs.
For businesses dependent on moving goods, the issue reaches beyond trucking procurement. Companies may need to weigh transport charges against delivery speed, inventory needs and supplier pricing. The advice also puts greater emphasis on making freight components visible, so a buyer can judge whether a supplier’s requested increase reflects transport costs and whether the shipment could be managed differently.
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Surcharges Outlast Fuel Swings
The surcharge question is especially significant in parcel delivery, where fees have not tracked pump prices evenly. The Q4 TD Cowen/AFS Freight Index, released Tuesday, compared diesel’s rise from an average of $2.91 a gallon in the first quarter of 2021 to $6.53 in September with parcel fuel surcharges rising from 7.75% to 30%. AFS attributed 72% of the 22.25-percentage-point surcharge increase to carriers rewriting their schedules, rather than to diesel prices alone. Its analysis estimated that surcharges would still be 23.75% if diesel returned to $2.91.
Bain’s report cites UPS as an example: the company raised its fuel surcharge from 21% before the conflict with Iran to 29.5% as of Sept. 21, then changed the mechanism so charges would fall more gradually as diesel prices declined. The report says carriers that have not renegotiated their schedules may follow. These figures describe specific surcharge policies and comparisons; they do not establish that every carrier uses the same formula.
Trucking company J.B. Hunt has also cited fuel-price volatility in discussing its business outlook. The company said third-quarter earnings would decline 5% to 10% sequentially. Chief Financial Officer Brad Delco pointed to fuel-price swings and a timing mismatch between intermodal pricing and costs. Meanwhile, J.B. Hunt’s intermodal business recorded double-digit volume growth in the second quarter for the first time in more than a decade, with management linking the increase to shippers shifting freight as truck pricing became less attractive.
“You can’t do much about diesel prices, but you can work on focusing on the controllable expenses within freight.”
— Jim Horrigan, Bain & Company expert partner
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Supply Outlook and Savings Risks
The IEA’s warning is an outlook, not a guarantee that diesel shortages will persist through 2027. The source material does not specify the scale or geographic distribution of the expected constraints, nor how supply could change if production, refining capacity or demand shifts. The latest EIA price is a national weekly average and does not show the price paid by every shipper or carrier.
It is also unclear how much individual companies can save by adopting Bain’s recommendations. Results will depend on contract terms, route options, delivery requirements, carrier policies and the cost of holding extra inventory. Rail may be cheaper per mile than truckload, Horrigan said, but late trains can undermine the economics. Surcharge schedules vary, and the parcel-index figures should not be treated as a universal measure of all freight charges.
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Contract and Mode Decisions Ahead
Shippers can use the IEA’s supply outlook and weekly EIA price data as they review transport contracts, including how surcharge benchmarks are set and how often charges may change. Bain’s recommendations also point to practical reviews of rail-eligible lanes, delivery windows, drop-trailer arrangements, empty miles and the freight costs embedded in supplier pricing.
The next indicators will include subsequent IEA supply assessments, weekly EIA diesel prices and carrier or shipper updates on surcharges and transport volumes. The source material does not provide a specific timetable for when diesel supplies might ease, or a forecast for how quickly contract changes could affect freight bills.
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Key Questions
What did the IEA warn about diesel supplies?
The International Energy Agency said Tuesday that constrained diesel supplies could persist well into 2027, citing counter-seasonal stock draws, restricted production and peak winter demand. That is a forecast, not confirmation that shortages will last for a set period.
Did U.S. diesel prices fall?
Yes. The EIA reported a national average on-highway diesel price of $6.179 a gallon in the latest reported week, down from $6.382 for the week of Sept. 28. The source says the price remained more than $2.50 a gallon above the year-earlier level.
What does Bain advise shippers to do?
Bain recommends negotiating fuel-surcharge terms, shifting suitable freight to rail where service requirements allow, reducing wasted miles and idle time, and reviewing inbound freight and supplier charges. These steps target expenses shippers may be able to influence; they cannot control diesel prices.
Why are fuel surcharges a concern if diesel prices fall?
Surcharge formulas may not move in lockstep with fuel prices. The Q4 TD Cowen/AFS Freight Index attributed much of the increase in parcel surcharges since 2021 to carriers rewriting their schedules, and Bain’s report says some mechanisms may allow charges to decline more slowly than fuel prices.
Is a shift from trucking to rail always cheaper?
No. Bain’s Horrigan said rail can cost less per mile than truckload, but a late train can weaken the savings. The suitability of a shift depends on delivery timing, route, inventory buffers and a company’s service needs.
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