Furlog sees impact higher fuel prices on transport rates

Image: FurlogImage: Furlog

Italian logistics operator Furlog has informed that it is no longer able to absorb the fluctuations in the price of diesel, which is worsening due to the war in Ukraine. “These unregulated and unpredictable increases are inevitably having an impact on transport services and thus on our offerings”, the company says.

Energy prices in Europe have been on the rise for several months, as a byproduct of the decarbonisation efforts. The rigid pricing of carbon under the EU Emissions Trading System (ETS) is a policy tool aimed at bringing down energy consumption. However, the revival of the market after a period of stringent lockdowns increased pressure on the market and pushed the prices up further than what was anticipated. Due to the Russia-Ukraine war, these prices are now escalating to even higher levels.

Only for kilometres on road

“In this serious and uncertain international situation due to the Russian-Ukrainian conflict, as you know, the energy crisis of the last few months is also worsening, with the price of diesel fuel constantly rising”, Furlog said today.

“Despite our efforts to maintain price stability by absorbing the fluctuations in input costs, these unregulated and unpredictable increases are inevitably having an impact on transport services and thus on our offerings.”

It does make the remark that its transport services cover most of the distance by rail, which means that “the fuel surcharge will be calculated only on the kilometers actually covered by road for the first and last mile, and that the impact on costs will be moderate.”

Worrying trend

However, Furlog is not the only company signalling a concerning upward trend of fuel prices. Especially in the road sector, these price fluctuations are hard to absorb. In the Netherlands, the government announced today a number of measures to alleviate the pressure on the market.

“The price for petrol now consists of about half excise duties and VAT, and the price of diesel about 40 pe rcent. The excise duty will be reduced from 1 April by 17 cents per liter of unleaded petrol and 11 cents per liter of diesel”, it has just announced in a statement.

The European Commission is moving in another direction. In a statement published today, it announced that by mid-May, it wants to present a RePowerEU plan to phase out dependencies on Russian fossil fuels by 2027. “We are too dependent on Russian fossil fuels and in particular, gas. We need to diversify suppliers, notably by switching to LNG and increase our share of renewables.”

Author: Majorie van Leijen

Majorie van Leijen is the editor-in-chief of RailFreight.com, the online magazine for rail freight professionals.

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