Data from Eurostat shows European diesel prices have dropped to their lowest level for over three years. In the first two weeks of May 2025, the EU‑weighted diesel price at the pump dropped to €1.52; the last time diesel prices fell below this level was May 2022.
This is the result of consistent price falls week‑on‑week since the start of the year. On average, European diesel prices have dropped 0.2 % each week of 2025. European weighted‑average prices in the first week of May are 6.2 % lower than in the first week of 2025, and some major economies are seeing prices fall even faster. In France, diesel prices in May are 6.6 % lower than in the first week of 2025, and in the Netherlands the price has dropped by 8.1 %.
What does this mean for European logistics markets?
Following multiple years of high cost rises, these fuel‑price falls have eased supply‑side pressure on European logistics rates, especially on road freight and, in turn, on contract‑logistics markets in Europe. Cost rises have increased the cost base of European logistics suppliers and reduced profit margins across the continent. This has been further exacerbated by low and falling demand for goods from both consumers and producers. This, in turn, has produced little upward pressure on rates to protect profit margins.
Lower fuel prices may allow some carriers to increase profit margins for the time being, especially in the spot market.
In the contract market, however, most contracts will include a fuel surcharge, which will vary with the cost of fuel in an effort to guarantee consistent contribution levels across the course of the contract. However, lower fuel prices will still mean cheaper outsourced logistics costs for shippers across the continent.
It is unclear what direction fuel prices will take in this turbulent and unpredictable world we’re currently existing in, but further falls will take us to some of the lowest levels in over three years, and that is a very significant story for the cost of logistics in Europe.
Author: Nathaniel Donaldson
Source: Ti Insight
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