By Jeffrey Michael
The diesel fuel shock hitting the nation is impacting many Montana households extra hard. In fact, some Montanans are talking about leaving their diesel trucks in the garage and driving gas vehicles.
U.S. Department of Commerce data reveals that Montanans spend 27% more per capita on motor vehicle fuels than the average American, and as a result, gas prices are causing 27% more pain to the average Montana household than nationally (see BBER article on disproportionate gas prices here)
Gas prices continue to remain high, but now diesel prices have spiked even higher, exceeding $6 per gallon across the state. And that is making the pain in our state even worse because Montanans have much higher reliance on diesel vehicles. Diesel vehicles perform well in rural, mountain environments, making them a practical option in places like Montana and Wyoming where they are most common.
Montana ranks #2 in the nation for diesel vehicle concentration at 10.9% of light-vehicle registrations – which includes passenger vehicles and most pickup trucks – ranking only behind Wyoming, and over three times higher than the U.S. average of 3.3% diesel vehicles, according to BBER calculations of U.S. Energy Information Administration data.
Looking at so-called medium-duty and heavy-duty vehicles, the majority of which are diesel, shows that 12.3% of total vehicles in Montana are medium/heavy duty vs. 6.2% nationally, making the concentration of medium/heavy duty vehicles about double the national average.
Another measure of diesel intensity of the economy is diesel consumption per dollar of GDP. For this measure, we have to look at distillate fuels consumption, which includes diesel fuel for transportation and related products used for home heating and industrial uses. By this measure, Montana ranks 8th highest. While still very high, Montana is a little lower in this ranking. A few states moved ahead of Montana, including the states with very high industrial use of distillate fuels or those that commonly use distillate oil to heat homes and buildings (Maine), or have lower GDP per capita (Mississippi). See related article here.
By any measure, the diesel shock is tough on Montana households. While people driving diesel vehicles sometimes ponder switching to gas vehicles, not everyone has the ability to do that – especially those who need trucks to make a living. And this definitely hits rural Montana more than larger, urban cities in the state since reliance on diesel trucks for work and rural life is higher.
