The 2:00 Minute Warning

Last week, I wrote about why scenario planning matters in a volatile market. I want to revisit that message this week because fuel continues to soar, ocean markets remain under pressure, and shippers need to understand what that could mean for freight costs, margins, and supply chain exposure.

What will your company do if oil moves to $175 a barrel... or even $200... sometime in the next six to nine months?

I am not predicting that it will happen. I am saying it is possible. And when the stakes are this high, sitting on your butt and doing nothing is not a strategy.

Over just a few weeks, fuel has moved sharply higher. On March 2, diesel was $3.90 per gallon. By March 23, it had climbed to $5.375 per gallon. That is not just a market data point—it’s a direct hit to freight costs.

At the beginning of March, LTL fuel surcharge was about 32% of linehaul freight charges and TL fuel surcharge was about 35%. Today, those numbers are approximately 47.8% for LTL and 51% for TL. No shipper built a budget assuming freight costs would jump 15% to 16% this fast. But here we are.

And there is another important point that should not be overlooked: a one-dollar increase or decrease in your LTL rates can be worth about $1.45 to your bottom line.

Recently, I spoke with a senior logistics executive who told me his C-level team had asked him to outline where the oil markets may be in the next six to nine months and what that could mean for the business.

The honest answer is simple: no one knows. But that is exactly why scenario planning matters.

Scenario planning is not about predicting the future. It is about asking the right what-if questions now, while you still have time to act. What if fuel rises further? What if it settles back? What if ocean disruptions continue to create pressure across the supply chain? What if mode shifts, sourcing changes, or service issues add even more cost?

The real value of scenario planning is that it helps you assess how these market changes could impact your business and what options and alternatives you may have to work around them.

With continued disruption in ocean markets and ongoing uncertainty across the supply chain, every shipper should be asking: Is my supply chain exposed? How vulnerable are we if fuel remains elevated or moves even higher? Where will this show up in our transportation spend, margins, and customer commitments? What alternatives do we have right now to reduce risk and protect the bottom line?

If you already know the answers to those questions, that is good.

If you do not know, or if you are not as confident as you need to be, this is the time to act. TranzAct works with companies every day to evaluate exposure, model the cost impact of changing market conditions, and identify practical options to help protect margin and improve decision-making before issues become even more expensive.

You do not need a crystal ball to prepare for uncertainty. But you do need a plan. And if you are not sure how higher fuel costs, oil volatility, or supply chain disruption could affect your business in the months ahead, TranzAct is ready to help. The time to think through your options is now—before the market does it for you.

If you would value a thoughtful conversation about your exposure, your options, and the steps you can take now to protect both freight spend and supply chain performance, we welcome the opportunity to talk to you.

Give us a call at 630-833-0890, send us an email, or schedule a conversation.