Any affect of fuel prices could affect on transportation. Weather the fuel prices is high or low, transportation carriers get affected. In general, the lower fuel prices the less expensive to run the business. Each transportation mode has its own benefit of lowering or increasing the fuel prices. Air carrier, road carrier, rail carrier and water carrier are all depends on each other and all of them depends on fuel prices. The benefit of lowering of increasing the fuel prices is not equally shared between all different transportation modes.
Since 1976, motor carriers experienced very high increasing in fuel costs. Increasing fuel prices became relatively high in total cost of operation. The labor regulation is complex also; the federal rules of limiting the hours of driving might affect the operation cost. The fuel costs include federal and state diesel fuel taxes imposed as part of highway user. However, fuel cost is a supply and demand game. Whether its air, water, or truck transportation. Any changes in the fuel price will affect the transportation mode. Reducing the fuel prices in a logistic transportation, will increase the demand of transportation and speed. Transportation and speed is two main factors that needed to be good for customers. With the reduce of fuel cost, customers will ask
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Fuel is a major cost for this mode of shipping. However, this mode is very slow but can take very large products; on the other side, this mode asks more oil. Using this method of shipping is very cheap for large items out of the other transportation modes. Therefore, increasing the oil costs will make the customers using this method for the cheaper price the water carriers have. In addition, increasing fuel cost on the water transportation would increase the transportation shipping prices, which will lead manufacturers and shippers to look for other transportation