“A year ago, my monthly fuel costs were around 480,000 to 500,000 won, but now it exceeds 600,000 won. My income remains the same, but my expenses keep rising,” said Lee, a delivery driver in Seoul. He refuels his vehicle about twice a week, spending approximately 600,000 won on fuel each month. With diesel prices rising to around 1,800 won per liter from the 1,500 won range last year, each 40-liter fill-up now costs him an additional 12,000 won. Lee added, “I can’t reduce my work hours just because fuel prices are rising; most of us rely on our monthly earnings to make ends meet, so ultimately, we’re left with less money.”
The prolonged global diesel supply crisis is expected to impact delivery drivers and small freight operators first if domestic prices continue to rise. This is due to the structure where drivers bear the direct costs of fuel while using personal vehicles for deliveries. Although the adoption of electric trucks is increasing, industry experts note that diesel vehicles still dominate due to considerations like charging infrastructure and operational efficiency.
According to the Korea National Oil Corporation's Opinet, the average price of diesel at gas stations nationwide was 1,842.01 won per liter as of 10 a.m. on October 18. Diesel prices were 1,534.39 won on October 18 last year, spiking to over 2,000 won in May before fluctuating around 1,800 won since July 3. While domestic supply remains relatively stable, prolonged supply disruptions from the Middle East and Russia could lead to delayed reflections of international price increases in the domestic market.
A key issue is that delivery drivers do not see immediate increases in their fees when fuel prices rise. An industry insider explained, “Delivery companies pay a fixed fee per box to agents, so fuel price increases do not immediately change the commission structure. For now, it’s the drivers who operate the vehicles that bear the cost burden.” The insider added, “There is no separate fuel cost support from the companies, and if high fuel prices persist, agents or drivers may demand adjustments in transportation fees at the time of contract renewal.”
While long-haul transport contracts may allow for fuel price increases to be reflected in freight rates during renewals, delivery drivers receive a fee per box, making it difficult to recover short-term fuel cost increases. Small freight operators face even more direct pressure. They cannot easily raise already established freight rates, while fuel costs accrue with each trip. When factoring in vehicle financing, insurance, and maintenance costs, rising diesel prices can lead to a decrease in real income. Particularly for small operators with long-term contracts, renegotiating freight rates during the contract period can be challenging, forcing them to absorb increased costs themselves.
The cost pressures are not limited to the delivery sector. Retailers and small manufacturers may also face increased transportation costs during raw material procurement and finished product delivery. Small businesses, which have limited capacity to absorb costs, are likely to see a direct impact on profitability due to rising logistics expenses. If diesel prices continue to rise, there may be upward pressure on delivery fees or product prices.
An industry representative noted, “Currently, individual operators are absorbing the rise in fuel costs, but if this continues, a reevaluation of transportation rates may become unavoidable. Ultimately, this could lead to increased cost burdens across the delivery, retail, and small business sectors.”
* This article has been translated by AI.
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