* Soaring diesel prices threaten to idle independent

drivers and small fleets

* Diesel price rise outpacing that of gasoline, putting

more pressure on truckers

* US trucking industry dominated by small firms

(Updates graphic)

By Nicole Jao and Lisa Baertlein

NEW YORK/LOS ANGELES, April 14 (Reuters) - The more than

3 million U.S. truckers who move goods for everything from

grocery stores to factories to construction sites are grappling

with the highest diesel prices in years, compounding pressure on

the industry as Iran war-related oil price spikes also threaten

to weaken freight demand.

Diesel is the second-largest operating expense for truckers

and the national average retail price has jumped $1.89, or 50%,

since the start of the Iran war effectively halted shipping

through the Strait of Hormuz, a vital artery for global energy

flows. Crude oil prices, which underpin diesel and gasoline,

also surged, driving up transportation costs and prices for many

consumer goods.

Experts warned there was no relief in sight as diesel prices in

logistics hubs including California and Texas hit all-time highs

and a ceasefire announced last week by the U.S. and Iran looked

fragile.

Trucking is a barometer of how the U.S. economy is doing. In

2024, the industry moved 11.3 billion tons of freight - nearly

three-quarters of the national total, including manufactured and

retail goods - and generated $906 billion in revenue, according

to American Trucking Associations.

As of Monday, U.S. fleets on average spent $5.52 per gallon

on diesel, surpassing the prior all-time high of $5.50 set in

June 2022 after Russia invaded Ukraine, according to data from

fleet management technology provider Samsara. The firm's

fuel spend data, which accounts for discounts and surcharges, is

from more than 5,500 fleets of all sizes across the entire U.S.

and represents nearly 1 billion gallons of fuel purchases.

"Not one firm had $5.60 a gallon diesel on their proverbial

budget bingo card for 2026," said Jason Miller, a supply chain

professor at Michigan State University.

Delivery firm FedEx ( FDX ), which also operates one of the

nation's largest trucking firms, said the fallout from the

U.S.-Israeli war on Iran could weigh on ​fourth-quarter

performance if soaring fuel costs prompt customers to pull back.

SMALL FIRMS HIT HARDEST

A March poll from DAT Freight & Analytics shows 18% of

over 540 surveyed trucking firms had halted operations due to

the spike in fuel prices. About 44% of the firms, which were of

various sizes from across the U.S., were being more selective

about load weights and about 45% were driving fewer miles.

U.S. trucking is dominated by small businesses. As of June

2025, there were almost 580,000 active U.S. motor carriers

registered, with 91.5% of those operating 10 or fewer trucks,

ATA said, citing Department of Transportation data.

The surge in diesel prices has wiped out profits for most

small carriers and owner-operators from December, January and

February, DAT's principal analyst Dean Croke said in a market

update, adding most other operators are still slightly above

breakeven.

Heather Hickson Griffith, a former Marine who has more than

a decade of experience behind the wheel of a big rig, is paying

up to $8 per gallon in California - a price that is eating

through her savings faster than during the 2022 fuel-price

spike.

As a result, the Oklahoma-based heavy equipment hauler has

stopped eating at restaurants to help save money. Her husband

Daniel Griffith is running cargoes on the East Coast, where fuel

is cheaper. GKZ Trucking, their small company of 21

owner-operators, does not have the heft of large trucking firms

to recoup higher fuel costs - and is more vulnerable to cash

flow and profit squeezes when prices soar.

Independent drivers like Hickson Griffith often pay

out-of-pocket for fuel and can have trouble convincing customers

to reimburse them when prices rise. Large companies, on the

other hand, often negotiate volume discounts from fuel sellers

and use surcharges to claw back higher fuel costs from clients.

Without relief, Hickson Griffith said, "By the end of the

year I am going to be hurting to the point of no return."

Soaring diesel prices could force thousands of small

operators out of business, worsening already tight trucking

capacity, said Avery Vise, vice president of trucking at FTR

Transportation Intelligence.

Freight rates are expected to rise even more sharply than in

2022, Vise said.

Transportation accounts for a small portion of the overall

cost of goods - but can top 20% for staples like milk,

researchers at Texas A&M Transportation Institute found.

So far, inflation is lagging levels seen in the 2022

Russia-Ukraine war energy shock, when pandemic-related supply

chain disruptions and massive federal spending contributed to

soaring prices.

RISK OF FURTHER PRICE RISES

Nevertheless, high fuel prices have become a political

headache for President Donald Trump and his Republican Party as

midterm elections near.

States including California, Hawaii, Nevada, North

Carolina and Texas have reported diesel prices hitting record

highs since the Middle East conflict escalated.

The jump in diesel prices has far outpaced rises in

gasoline, said Kelly Soderlund, Samsara's head of insights,

adding the two prices rose in tandem during the early days of

the Ukraine war. That means today's fuel prices are hitting the

trucking industry harder than everyday consumers, she said.

Motorists should prepare for another round of price surges

after ceasefire talks between the U.S. and Iran yielded no

agreement over the weekend, sending oil prices sharply higher,

said Patrick De Haan, head of petroleum analysis at GasBuddy.

"The move toward a full blockade of the Strait of Hormuz is

compounding global supply concerns and risks further disrupting

flows," he said.