TEG Index at a glance
The TEG Price Index rose by 2.6 points (1.91%) in August to reach 138.5, reflecting seasonal trends. Year-on-year, the TEG Index was 8.8 points (6.78%) higher last month than in August 2025.
The Haulage Index drove the monthly increase, rising 5.5 points (4.08%) to reach 140.4. The shift was even more pronounced for artic vehicles, where prices rose 7.8 points (6.2%) month-on-month to reach 134.6. Compared with August 2025, last month’s haulage prices were 10.7 points (8.25%) higher.
Meanwhile, the Courier Index fell by 0.3 points (0.22%) in August to 136.6. This left the index 6.9 points (5.32%) higher than 12 months before.
Lower haulage availability pushes prices higher
August is often quieter economically as people enjoy time away with family and friends. That perhaps explains why transport demand fell by 8.46% last month, following relatively level demand in July. The more interesting point is the difference between haulage and courier demand: haulage demand fell by 0.51% while courier demand dropped by 12.1%.
Adding to the picture, transport availability declined by 13.93% last month. The fall is once again typical for August, especially with a bank holiday shortening the working month. And yet, the difference between haulage and courier availability was marked. Haulage availability dropped by 20.7%, most likely as drivers took annual leave across summer. Courier availability, meanwhile, fell by 12.7%, perhaps reflecting the many small and solo businesses that underpin courier transport, which are often incentivised to operate when opportunities exist.
The differences between haulage and courier demand and availability go some way to explaining why haulage transport prices rose and courier prices fell in August. Higher operating costs, particularly fuel, may tell more of the story.
Fuel prices continue to rise
Fuel costs added upward pricing pressure in August as costs rose once again.
Average diesel prices rose by 14.02p per litre (8.37%) in August to reach 181.61p. This was 39.43p per litre (27.73%) higher than in August 2025.
Petrol prices also rose in August but by less than diesel. Average prices reached 161.37p per litre, 9.18p (6.03%) higher than in July. Compared with August 2025, petrol was 27.15p per litre (20.23%) higher last month.
Fuel prices typically move with Brent crude oil prices, which are more than 30% higher than a year ago. Global oil supplies and activity in the Strait of Hormuz also affect fuel price movement. Attempting to ease price volatility, International Energy Agency (IEA) members agreed to collectively release 400 million barrels of emergency oil stocks from March to July. However, as the Middle East conflict continues, global oil buffers have rapidly shrunk and global refining capacity, especially for diesel, is tightening. Safely opening the Strait of Hormuz remains key to easing fuel price uncertainty.
Confidence holds despite higher costs
Economic confidence remained surprisingly resilient during August. Building on a six-point rise in July, the largest increase since November 2023, the GfK Consumer Confidence Index increased a further three points in August to reach its highest level in two years.
Logistics UK published its latest Logistics Performance Tracker survey on 20 August. The findings suggest the second quarter of the year brought increased industry confidence and financial health despite ongoing challenges, although caution remained overall. In fact, 57% of respondents said they expected transport prices to rise in the short to medium term, something we’ve already seen happening.
Why has confidence remained resilient? One reason may be that the economy has outperformed expectations following the war in Iran. Fuel prices have risen, but inflation and interest rates remain stable. News fatigue may also have set in: six months since the Iran war began, coverage is less prominent than it perhaps once was.
The next test for optimism may be the Autumn Budget. With the Prime Minister unable to rule out tax hikes, October could see higher costs for businesses and/or lower spending power for consumers.
Price rises have become part of the conversation
With transport prices currently running 6.78% higher year-on-year, talk of price increases during 3PL contract renegotiations is no longer heresy. Constant reports of haulage insolvencies and driver shortages are impossible to ignore, and proactive 3PLs will likely feel confident about correcting prices to protect ebbing margins.
In this way, a short-term pain has become a longer-term opening. It’s clear to all parties that transport rates must rise to cover unexpectedly elevated costs. The question has become not if, but by how much. With peak season fast approaching, 3PLs must price sustainably to keep freight moving.
Industry pulse
Looking at the wider industry picture, the Bank of England held interest rates at 3.75% throughout August, although they’ve warned increases may well follow.
Meanwhile, inflation increased to 2.9% in July, up from 2.6% in June, with prices likely to rise further during 2026. Household gas and electricity spearheaded the latest increase following a 13% rise in the energy price cap from 1 July, and Ofgem has already announced a further 4% increase from October. In contrast, food price inflation was the lowest since September 2021, although experts say higher prices take time to reach retail shelves.
The average HGV salary fell slightly in August to £42,797. In contrast to July, this was just below the national average salary (£42,942). HGV vacancies rose, however, which aligns with haulage availability having fallen during August.
Brent crude oil prices continued to move unpredictably throughout August in response to activities and expectations around the Strait of Hormuz opening. The month closed with a price around $93 a barrel, at least 34% higher than in August 2025.
Expert comment
“Things are not looking easy for the forthcoming peak. Haulage rates are higher than they’ve ever been and, perhaps too late, probably now high enough to cover costs for the first time since the US went to war with Iran. The story is not ‘just’ about small hauliers being bought out or going into administration. It’s also about the big boys – with the number of HGVs on the road being squeezed, make sure you can cover your requirements – not just a plan but contingency plans too!”
Kirsten Tisdale – Senior Logistics and Supply Chain Consultant – Aricia Ltd