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Transportation

Diesel 101: Why Truck Stop Diesel Is Still Above $6 a Gallon as Crude Falls

Transportation via FreightWaves
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SONAR’s new sitrep traces diesel from crude to truck stop and explains why prices are holding near record highs, even as Brent drops. Diesel is expensive because refined product supply, not crude, is the bottleneck. Middle East and Russian refinery damage, longer tanker routes and thin U.S. inventories have pushed the diesel crack spread to about three times its early-2026 level. window.googletag = window.googletag || {cmd: []}; googletag.cmd.push(function() { var gptSlot = googletag.defineSlot('/21776187881/FW-Responsive-Main_Content-Slot1', [[300, 100], [320, 50], [728, 90], [468, 60]], 'div-gpt-ad-1709668545404-0').defineSizeMapping(gptSizeMaps.banner1).addService(googletag.pubads()); googletag.pubads().enableSingleRequest(); googletag.pubads().collapseEmptyDivs(); googletag.enableServices(); setInterval(function() { if (!document.hidden) { googletag.pubads().refresh([gptSlot]); } }, 60000); }); googletag.cmd.push(function() { googletag.display('div-gpt-ad-1709668545404-0'); }); SONAR’s truck stop diesel index (DTS.USA) was $6.23 per gallon on Nov. 9, 2026, up 65% from $3.78 a year earlier. That is about $0.89 per mile in fuel at 7 miles per gallon. SONAR’s new sitrep, Diesel 101: Prices and Logistics Markets, breaks down where that price comes from and what it means for carriers, shippers and brokers. Key takeaways Crude is falling faster than diesel. Brent is down 21% from its Oct. 30 high, but truck stop diesel is down only 2.5%. The crack spread is doing the work. The diesel crack against Brent was $2.51 per gallon on Nov. 9, versus a $0.87 average in January and February. Retail lags wholesale. The FUELS spread (truck stop minus rack) widened to $1.52 from $1.23 on Oct. 30 as rack prices fell faster than pump prices. EIA sees higher diesel for longer. Its November outlook raised the 2027 retail diesel forecast 12%, to $5.03 per gallon from $4.49. The index in your contract matters. On Nov. 9, SONAR’s daily truck stop price was about 10.5 cents above EIA’s weekly national average. Where $6.23 comes from The sitrep splits the Nov. 9 truck stop price into three parts using SONAR daily data: Crude is only about 35% of the truck stop price, and refining is now the largest piece. That is why a $25-per-barrel drop in Brent since Oct. 30 has barely moved the pump. Why diesel is so expensive now Less product supply abroad. IEA puts Middle East refined product exports at 1.9 million barrels per day, against 4.7 million before the war. Longer, riskier shipping. The Strait of Hormuz closure and the Red Sea blockade have stretched some tanker voyages from about 24 to 54 days. No spare U.S. refining capacity. Refineries ran at 96% in the third quarter, with less capacity than in 2019. Exports pull fuel abroad. U.S. distillate exports topped their 2021 to 2025 highs in six of seven months through July. Thin inventories. Distillate stocks were 13% below the five-year average in late September; East Coast stocks were 32% below. What comes next EIA’s November Short-Term Energy Outlook forecasts retail diesel at $6.05 per gallon in the fourth quarter of 2026, easing to $4.80 by the fourth quarter of 2027. At 7 mpg, that is $0.86 per mile now and $0.69 per mile by late 2027. EIA cautions that Middle East flows remain fragile, so short-term volatility will exceed its monthly path. window.googletag = window.googletag || {cmd: []}; googletag.cmd.push(function() { var gptSlot = googletag.defineSlot('/21776187881/fw-responsive-main_content-slot3', [[728, 90], [468, 60], [320, 50], [300, 100]], 'div-gpt-ad-1665767553440-0').defineSizeMapping(gptSizeMaps.banner1).addService(googletag.pubads()); googletag.pubads().enableSingleRequest(); googletag.pubads().collapseEmptyDivs(); googletag.enableServices(); setInterval(function() { if (!document.hidden) { googletag.pubads().refresh([gptSlot]); } }, 60000); }); googletag.cmd.push(function() { googletag.display('div-gpt-ad-1665767553440-0'); }); What it means for logistics Carriers: Your real exposure is the daily truck stop price, while many surcharge tables follow a weekly index that lags it. Shippers: Check which index and reset date your fuel surcharge uses; weekly indices lag the market in both directions. Brokers: Spot quotes embed a fuel assumption that can go stale within a week while the crack spread is moving. What’s inside the full sitrep How crude becomes diesel, and why a 42-gallon barrel yields only about 12 gallons of it Brent, WTI, rack and truck stop prices put on one per-gallon basis A worked 3-2-1 crack spread example across four SONAR crude series A refiner-profit model linking crack spreads to industry net income A 2026 event timeline from the Hormuz closure to the November Brent plunge EIA quarterly forecasts converted to fuel cost per mile and per truck-year The leading indicators to watch for the next move Subscribe to SONAR to read the full Diesel 101 sitrep → or checkout FreightWaves Market Monitor which also include SONAR research. Frequently asked questions Why is diesel so expensive right now? Refined product supply is the bottleneck, not crude. Damage to Middle East and Russian refineries, longer tanker routes around Hormuz and the Red Sea, and thin U.S. distillate inventories have pushed the diesel crack spread to about three times its early-2026 level. Why hasn’t diesel fallen as much as crude oil? Brent fell 21% from Oct. 30 to Nov. 9, 2026, but truck stop diesel fell only 2.5%. The diesel crack ($2.51 per gallon) and the FUELS spread between truck stop and rack prices ($1.52) absorbed most of the decline. What is the diesel crack spread? The diesel crack is the difference between the wholesale ULSD price and the cost of crude, a measure of refining margin. Measured as SONAR ULSDR minus Brent per gallon, it was $2.51 on Nov. 9, 2026, versus a $0.87 average in January and February. window.googletag = window.googletag || {cmd: []}; googletag.cmd.push(function() { var gptSlot = googletag.defineSlot('/21776187881/fw-responsive-main_content-slot4', [[300, 100], [320, 50], [728, 90], [468, 60]], 'div-gpt-ad-1709668086344-0').defineSizeMapping(gptSizeMaps.banner1).addService(googletag.pubads()); googletag.pubads().enableSingleRequest(); googletag.pubads().collapseEmptyDivs(); googletag.enableServices(); setInterval(function() { if (!document.hidden) { googletag.pubads().refresh([gptSlot]); } }, 60000); }); googletag.cmd.push(function() { googletag.display('div-gpt-ad-1709668086344-0'); }); What is the difference between the rack price and the truck stop price? The rack price (SONAR ULSDR) is the wholesale ULSD price at fuel terminals. The truck stop price (SONAR DTS) adds delivery, taxes and retail margin. The gap between them is SONAR’s FUELS spread. What is the diesel price forecast for 2027? EIA’s November 2026 Short-Term Energy Outlook forecasts retail diesel averaging $5.03 per gallon in 2027, up from $4.49 in its October outlook, with the fourth quarter of 2027 at $4.80. The post Diesel 101: Why Truck Stop Diesel Is Still Above $6 a Gallon as Crude Falls appeared first on FreightWaves.

SONAR’s new sitrep traces diesel from crude to truck stop and explains why prices are holding near record highs, even as Brent drops.

Diesel is expensive because refined product supply, not crude, is the bottleneck. Middle East and Russian refinery damage, longer tanker routes and thin U.S. inventories have pushed the diesel crack spread to about three times its early-2026 level.

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SONAR’s truck stop diesel index (DTS.USA) was $6.23 per gallon on Nov. 9, 2026, up 65% from $3.78 a year earlier. That is about $0.89 per mile in fuel at 7 miles per gallon. SONAR’s new sitrep, Diesel 101: Prices and Logistics Markets, breaks down where that price comes from and what it means for carriers, shippers and brokers.

Key takeaways

  • Crude is falling faster than diesel. Brent is down 21% from its Oct. 30 high, but truck stop diesel is down only 2.5%.
  • The crack spread is doing the work. The diesel crack against Brent was $2.51 per gallon on Nov. 9, versus a $0.87 average in January and February.
  • Retail lags wholesale. The FUELS spread (truck stop minus rack) widened to $1.52 from $1.23 on Oct. 30 as rack prices fell faster than pump prices.
  • EIA sees higher diesel for longer. Its November outlook raised the 2027 retail diesel forecast 12%, to $5.03 per gallon from $4.49.
  • The index in your contract matters. On Nov. 9, SONAR’s daily truck stop price was about 10.5 cents above EIA’s weekly national average.

Where $6.23 comes from

The sitrep splits the Nov. 9 truck stop price into three parts using SONAR daily data:

Crude is only about 35% of the truck stop price, and refining is now the largest piece. That is why a $25-per-barrel drop in Brent since Oct. 30 has barely moved the pump.

Why diesel is so expensive now

  • Less product supply abroad. IEA puts Middle East refined product exports at 1.9 million barrels per day, against 4.7 million before the war.
  • Longer, riskier shipping. The Strait of Hormuz closure and the Red Sea blockade have stretched some tanker voyages from about 24 to 54 days.
  • No spare U.S. refining capacity. Refineries ran at 96% in the third quarter, with less capacity than in 2019.
  • Exports pull fuel abroad. U.S. distillate exports topped their 2021 to 2025 highs in six of seven months through July.
  • Thin inventories. Distillate stocks were 13% below the five-year average in late September; East Coast stocks were 32% below.

What comes next

EIA’s November Short-Term Energy Outlook forecasts retail diesel at $6.05 per gallon in the fourth quarter of 2026, easing to $4.80 by the fourth quarter of 2027. At 7 mpg, that is $0.86 per mile now and $0.69 per mile by late 2027. EIA cautions that Middle East flows remain fragile, so short-term volatility will exceed its monthly path.

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What it means for logistics

  • Carriers: Your real exposure is the daily truck stop price, while many surcharge tables follow a weekly index that lags it.
  • Shippers: Check which index and reset date your fuel surcharge uses; weekly indices lag the market in both directions.
  • Brokers: Spot quotes embed a fuel assumption that can go stale within a week while the crack spread is moving.

What’s inside the full sitrep

  • How crude becomes diesel, and why a 42-gallon barrel yields only about 12 gallons of it
  • Brent, WTI, rack and truck stop prices put on one per-gallon basis
  • A worked 3-2-1 crack spread example across four SONAR crude series
  • A refiner-profit model linking crack spreads to industry net income
  • A 2026 event timeline from the Hormuz closure to the November Brent plunge
  • EIA quarterly forecasts converted to fuel cost per mile and per truck-year
  • The leading indicators to watch for the next move

Subscribe to SONAR to read the full Diesel 101 sitrep → or checkout FreightWaves Market Monitor which also include SONAR research.

Frequently asked questions

Why is diesel so expensive right now? Refined product supply is the bottleneck, not crude. Damage to Middle East and Russian refineries, longer tanker routes around Hormuz and the Red Sea, and thin U.S. distillate inventories have pushed the diesel crack spread to about three times its early-2026 level.

Why hasn’t diesel fallen as much as crude oil? Brent fell 21% from Oct. 30 to Nov. 9, 2026, but truck stop diesel fell only 2.5%. The diesel crack ($2.51 per gallon) and the FUELS spread between truck stop and rack prices ($1.52) absorbed most of the decline.

What is the diesel crack spread? The diesel crack is the difference between the wholesale ULSD price and the cost of crude, a measure of refining margin. Measured as SONAR ULSDR minus Brent per gallon, it was $2.51 on Nov. 9, 2026, versus a $0.87 average in January and February.

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What is the difference between the rack price and the truck stop price? The rack price (SONAR ULSDR) is the wholesale ULSD price at fuel terminals. The truck stop price (SONAR DTS) adds delivery, taxes and retail margin. The gap between them is SONAR’s FUELS spread.

What is the diesel price forecast for 2027? EIA’s November 2026 Short-Term Energy Outlook forecasts retail diesel averaging $5.03 per gallon in 2027, up from $4.49 in its October outlook, with the fourth quarter of 2027 at $4.80.

The post Diesel 101: Why Truck Stop Diesel Is Still Above $6 a Gallon as Crude Falls appeared first on FreightWaves.

Source: FreightWaves

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Transportation

One of 3 ratings agencies now has XPO as investment-grade

LTL carrier XPO is now an investment-grade credit at one of the three major ratings agencies. Fitch Ratings has upgraded its rating on XPO (NYSE: XPO) to BBB-. That is one notch above the cutoff between investment-grade and non-investment grade debt. It comes just a few months after both Moody’s (NYSE: MCO) and S&P Global Ratings (NYSE: SPGI) raised their ratings on XPO by one notch, BB+ at S&P Global and Ba1 at Moody’s. Both those grades are considered equivalent, but they are also both below the cutoff between investment grade and non investment grade debt. Fitch first rated XPO in March 2023. Its first grade was BB+. It held that rating until the most recent change. “The upgrade reflects robust operating and commercial execution and structural improvement in XPO’s business and cash flows at a pace above the industry,” Fitch said in its report released late last week. “Significant gross debt repayment shows swift, meaningful commitment to publicly stated leverage targets in 2026.” As a publicly-traded company, XPO’s financial situation is well-known, unlike companies that are privately-held but which have publicly-traded debt. Between the third quarters of 2025 and 2026, XPO saw its revenue rise 12.4% to $2.37 billion, saw net income climb to $181 million from $82 million, and improved its adjusted operating ratio to 80.1% from 82.7%. But from the perspective of a ratings agency like Fitch, a more important number would be that in the nine months ending September 30, its repayment of debt climbed to more than $1 billion from $50 million in the corresponding period of 2025. Cash flow also is king for ratings agencies, and Fitch liked what it sees at XPO. “XPO’s financial flexibility benefits from stronger free cash flow (FCF), which Fitch forecasts at around $500 million in 2026 and 2027, on a Fitch-calculated basis, up from about $270 million in 2025,” the agency said. Fitch noted that it has a proprietary method for measuring cash flow. Two key benchmarks–EBITDA and EBITDAR to debt, with the R in EBITDAR representing rent costs–will be in the low 2.0X range this year at XPO, Fitch said. That is down from 2.8X and 2.7X, respectively, from the 2025 figure. “The announced focus on internal initiatives over large inorganic growth and balanced debt and equity repurchase deployment in 2026, indicated a strategy to maintain leverage,” Fitch said. Fitch made comparisons of XPO’s debt ratings to three other companies. One is Brink’s of armored car fame, but the only overlap is that they transport something, though what Brinks is hauling isn’t what one would find in the back of an LTL truck. The two other comparisons were to TFI International (NYSE: TFII) and Forward Air. Fitch does not have a rating on TFI International. But it said TFI’s historical average debt load is in the mid 1.0X to low 2.0X range. Forward Air, on the other hand, is now forecast to have recorded a debt load of more than 6.0X in 2026, improving to mid-5.0X range in 2028. Forward Air’s (NASDAQ: FWRD) rating at Fitch is B with a negative outlook. That is five notches less than the new rating for XPO at Fitch. The outlook on XPO is stable, which means an upgrade or downgrade is not likely in the foreseeable future. In recent years, the reports of ratings agencies about the state of trucking have been pessimistic, with LTL carriers getting just a slightly more optimistic outlook. But the Fitch report was upbeat on the prospects for the LTL sector. “Fitch expects the LTL industry’s profitability to be resilient through business cycles,” it said. “This reflects the competitive barriers tied to established asset-based networks. XPO and other large LTL operators have demonstrated a higher degree of pricing rationality through freight cycles relative to the truckload market. Contractual relationships in LTL also offer some additional cyclical stability over spot truckload markets, though typical contract tenors are one year.” XPO’s stock is up about 36.7% in the last year. It’s up about 3% in the last month and down about 7% in the last three months. XPO does not pay a dividend. In its notes about developments that could change its rating on XPO, Fitch mentioned “a deviation from capital allocation plans, such as initiating a large dividend or mergers and acquisitions (M&A) strategy that restricts financial flexibility.” XPO’s last significant acquisition was for real estate being divested by the bankrupt Yellow Corp. in 2024. More articles by John Kingston Teamsters say they’ve organized Amazon employees in Indiana; company demurs Transportation committee in House set for overhaul post-election New cyber thief gang targets transports; Hunt, Ryder and Echo hit The post One of 3 ratings agencies now has XPO as investment-grade appeared first on FreightWaves.

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