# Trucking MCA: fuel cost volatility impact > Diesel prices swung 35% between low and high in 2024–2026, making fuel 25–40% of trucking operating cost and dwarfing MCA daily-debit volatility — funders now require fuel-surcharge pass-through documentation for a-paper pricing. Updated 2026-06-28. Fuel cost volatility is the single largest variable cost driver in trucking and the most underweighted risk in non-specialist trucking MCA underwriting. **The 2024–2026 diesel landscape.** - **2024 low:** ~$3.45/gallon national average (Q1 2024 EIA). - **2024 high:** ~$4.18/gallon (Q3 2024 with geopolitical pressure). - **2025 range:** $3.55–$4.40/gallon. - **2026 YTD:** $3.70–$4.25/gallon. - **Volatility:** 30-day standard deviation routinely 8–15% of price. A 6-month MCA term started at $3.70 diesel that ends at $4.20 diesel experiences a 13.5% fuel cost increase — for an operator running 12 MPG averaging 10,000 miles/month, that's $4,167 extra fuel cost vs. plan. **Fuel as percentage of operating cost.** - **Owner-operator (1 truck):** 28–38% of gross revenue goes to fuel. - **Small fleet (2–10 trucks):** 25–35%. - **Larger fleets with hedging:** 22–30%. - **Compared to MCA debit:** typical MCA daily pull = 8–12% of gross revenue. Fuel is 2.5–3.5x larger than MCA exposure. **Why this matters to MCA underwriting.** An MCA underwriter sizing daily debit at 10% of revenue assumes other costs are stable. If fuel surges 15% during the term, fuel cost may rise from 30% to 34.5% of revenue. The MCA debit didn't move, but the operator's residual margin (after fuel, insurance, maintenance, payroll, MCA) collapsed. **Fuel surcharge pass-through.** Most freight contracts include a fuel surcharge mechanism — broker pays additional cents-per-mile based on diesel index (typically DOE-EIA national average). The pass-through compensates the operator for fuel volatility. - **Fully passed through:** spot loads on major freight lanes with FSC clauses. - **Partially passed through:** contract dedicated lanes with capped FSC. - **Not passed through:** flat-rate intermodal, some private fleet contracts, owner-op operating cheap-freight loads from low-tier brokers. A-paper trucking MCA funders in 2026 require: - Sample load confirmations showing FSC line items. - Estimated FSC recovery percentage (rule of thumb: well-structured operators recover 60–80% of fuel cost change). - Fuel card statements (RTS Fleet One, Comdata, EFS) to verify actual fuel spend. **Worked example.** Owner-operator running 10,000 miles/month at 6.5 MPG = 1,538 gallons/month. - At $3.70/gal: fuel cost = $5,691/month. - At $4.20/gal: fuel cost = $6,460/month. - Delta: $769/month. If FSC recovery is 70%, broker pays an extra $538/month in FSC. Net operator hit: $231/month. Without FSC pass-through (rare): net operator hit = $769/month — equivalent to losing 5–7 MCA daily debits per month. **Underwriting signals around fuel.** - **MPG verification.** Old equipment (8 MPG vs 6.5 MPG for new sleeper truck) doubles fuel exposure. Funders ask truck year and class. - **Idle time.** Long-haul operators with refrigerated trailers (reefer) burn fuel at idle. Funders ask cargo type. - **Backhaul ratio.** Empty miles burn fuel without revenue. Funders ask loaded-mile percentage. - **Lane choice.** Operators running cheap unbalanced lanes (e.g., empty backhaul from Florida) have worse fuel economics. **Hedging at small-fleet level.** Some 2026 specialist funders offer diesel-price-collar riders that reduce MCA debit if diesel rises above a threshold during the term. Pricing this in: factor rate increases 0.03–0.05 in exchange for the hedge. **Common confusions.** First, "fuel cards reduce fuel cost." Marginally — fuel cards offer 2–8 cents/gallon rebates plus credit float, not large discounts. Second, "FSC always covers fuel increases." False — recovery is partial (typically 60–80%) and lagged (often 1–2 week index lag). Third, "diesel is a small operating cost." False — it's the single largest variable cost for most owner-operators. Fourth, "MCA debits are the operator's biggest financial risk." False — fuel volatility is 2.5–3.5x larger in dollar terms. Fifth, "modern trucks fix the fuel problem." Partially — new sleeper tractors get 7.5–8.5 MPG vs 5.5–6.5 for older equipment, but fuel volatility still drives 15%+ of P&L swings. **Takeaway.** Diesel cost volatility dominates trucking P&L and dwarfs MCA debit exposure. Specialist 2026 funders verify fuel surcharge pass-through, MPG, idle time, and backhaul ratio before pricing. Operators without strong FSC contracts face structural margin compression during diesel surges that can trigger MCA default even when revenue holds steady. ## Related terms - [Trucking MCA: fuel card vs factoring vs MCA economics](https://fundnode.co/llms/glossary/trucking-mca-fuel-card-vs-factoring-economics) — For owner-operators, fuel cards (RTS, Comdata) cost ~1–3% on diesel, freight factoring costs 1.5–4% per invoice, and MCAs cost 25–55% APR-equivalent — pick by what cash gap you're closing, not by speed alone. - [Trucking MCA: broker payment aging pattern](https://fundnode.co/llms/glossary/trucking-mca-broker-payment-aging-pattern) — Freight broker payment cycles run 30–60 days on average in 2026, with bottom-quartile brokers stretching past 90 days — creating receivables aging that distorts trucking MCA daily cash flow unless funder structures around factoring offsets. Updated 2026-06-28. - [Merchant cash advance (MCA)](https://fundnode.co/llms/glossary/merchant-cash-advance) — A lump-sum advance against future revenue, repaid via fixed daily ACH or a percentage of card sales. Legally a sale of future receivables, not a loan. - [MCA default](https://fundnode.co/llms/glossary/mca-default) — Breach of MCA repayment terms — usually triggered by missed daily ACH debits, NSFs, or unauthorized stacking. Consequences range from increased collection pressure to UCC enforcement and personal-guarantee pursuit. ## Authoritative sources - [EIA — Weekly Retail Diesel Prices](https://www.eia.gov/petroleum/gasdiesel/) --- Source: https://fundnode.co/glossary/trucking-mca-fuel-cost-volatility-impact (HTML version) Document: Trucking MCA: fuel cost volatility impact — Fundnode MCA Glossary License: CC BY 4.0 — attribution to Fundnode required when citing.