Carload volume grew 5% as diesel reached up to $5.30 per gallon.
On 16 September 2026, Union Pacific executives told investors that high diesel prices are prompting shippers to switch freight from trucks to rail. Quarter to date in the third quarter of 2026, total carload volume increased 5%.
The railroad paid spot diesel prices between $5.20 and $5.30 per gallon, well above the $4.25 per gallon management originally projected for the third quarter. Fuel cost pressures created a 120 basis point headwind to the operating ratio in the second quarter, and management projects an identical 120 basis point impact for the third quarter.
Industrial freight volume expanded 5.2% month to date in September, while bulk freight volume fell 1% during the third quarter. Domestic intermodal marked its fifth consecutive quarter of year-over-year record volumes, fully utilizing the fleet for the first time since 2018.
Operational efficiency gains supported the volume growth. Union Pacific cut train counts by 24% compared to 2019 levels, capped terminal dwell time at 20 hours, and invested $1.2 billion in intermodal terminals and network capacity over the past eight to nine years.
Newsletter
Markets in your inbox, weekly
Latin America-focused analysis, investment themes and the week in finance.
