Fuel Surges and Freight Demand Climb Amid Market Volatility

Key Trends

Truckload Rates Rise Sharply
Iran conflict fuels continued diesel increase
Spot volumes continue to rise

Monthly News

Diesel prices have moved sharply higher in recent weeks amid rising geopolitical tensions and tighter fuel markets. The U.S. Department of Energy/EIA benchmark diesel price used for most fuel surcharges increased by nearly 25 cents in the latest update, extending a multi-week climb in the national average. Market volatility has been driven largely by geopolitical developments in the Middle East, including military action involving Iran and the temporary closure of the Strait of Hormuz, one of the world’s most critical oil transit routes. As a result, crude and diesel markets have reacted quickly, with diesel prices surging nearly $1.48 per gallon over a three-week period, the largest three-week increase on record.

Market Trends

Supply Update

FTR forecast for active truck utilization continues to grow despite softer growth than expected in freight volume. This is being driven by tighter driver capacity currently. Utilization is expected to top out this spring at 98% and then start to decline as headcount outpaces freight volume. Sonar’s Logistics Managers’ Index (LMI) for Transportation Capacity also indicates tightening capacity compared to March 2025. The current index sits at 39.2, where 50 represents neutral conditions, readings above 50 indicate increasing capacity, and below 50 signal declining capacity. Readings below 40 typically indicate capacity is tightening rapidly. The transportation pricing reading surged to 89.4 in March. This resulted in the highest positive inversion since November 2021.

Demand Update

Spot volumes continue to rise, driven heavily by flatbed volumes. Dry van and refrigerated volumes have recently gained some traction. Despite growing spot volumes, economic uncertainty is causing forecasts to be put into doubt. FTR’s forecast for truck loadings in 2026 dropped from +1.4% at the beginning of March to 0.8% y/y growth. This adjustment in forecast is better inline with other industry experts.

Rate Update

Truckload rates rose sharply in March, up 8.5%. Spot rates are at +17% y/y and contract rates are at +5.7% y/y. With continued economic uncertainty and escalating oil prices, forecasts for rates remain high through the end of 2026, with no major jumps but just continued steady increased levels. Van and refrigerated equipment rates are leading at +10% y/y gains with spot at +20%. Flatbed forecasts are right at +8% y/y.

Market Forecast

Outbound tender rejections continued climbing through March, reaching a peak of 14.92%, up from the multi-year high of 14.12% recorded in February. All modes experienced tightening capacity, with flatbed tender rejections previously hitting an all-time high of 47.03%, the highest level recorded in the eight years of available reporting. Given that February is typically one of the lowest-volume months of the year and usually experiences minimal disruption, the sustained increase into March is particularly notable.

Several factors have combined to create this “perfect storm” of rising rejections and escalating rates, including winter weather disruptions, stronger demand for building materials and industrial freight, and continued capacity exits across the trucking market. Rising diesel prices have also begun adding upward pressure on transportation costs, further tightening margins for carriers and contributing to upward rate movement.

The Axle Advantage

Life at Axle

Spring Cookout

The annual Spring Cookout is one of those nights the team looks forward to all year. With good food, music, and a strong sense of energy, it creates space to connect, unwind, and spend time together outside of the day-to-day. It brings people across teams together, creating an atmosphere you don’t always get during a busy week. Moments like this are a meaningful part of Axle’s culture, reinforcing the connection, trust, and team-first mindset that carry into how we show up and perform every day.

Quarter 1 Update

This quarter’s Community Spotlights featured Second Harvest Food Bank of East Tennessee, the American Heart Association, and Big Brothers Big Sisters of East Tennessee, each playing an important role in strengthening our community. Our team also stayed engaged through a variety of local events and partnerships throughout the quarter.

This quarter also highlighted the people behind that impact, recognizing Tucker Davis and Gabriella Schilling for their continued involvement with Big Brothers Big Sisters of East Tennessee. As they approach their second year as Bigs, their commitment to mentorship reflects the kind of consistent involvement that drives Axle Impact forward.

Did You Know?

At The Masters Tournament, the operation behind the scenes is built on precision months in advance. Every detail, from concessions to merchandise, is forecast based on historical demand and carefully staged throughout the day to ensure seamless restocking. Deliveries are timed and routed to avoid congestion, keeping everything running without disrupting the experience. More than efficiency, it’s about control and consistency, preserving the tradition the tournament is known for while executing at the highest level.