How Tariffs and Fuel Costs are Influencing Construction Costs

Wednesday, June 10, 2026
By Matt Sutter, Chief Executive Officer
In Design, Planning, Community

As we near the celebration of 250 years of the United States of America, the U.S. continues to be a nation of forward progress running through a road of uncertainty. So, nothing has changed since the signing of the Declaration of Independence on July 4, 1776. While the construction industry and the US economy in 2025 was marked by tariffs, this year has been marked by higher fuel prices. Tariffs in 2025 influenced some purchases. There were projects where furniture and retail display cabinetry were to be purchased in the Far East, but because of the unpredictability of tariffs adding to import costs and better local quality, U.S manufacturers were given contracts to produce the products instead of buying from overseas. Tariffs did increase construction cost but the result was a higher quality product.

In today’s market, fuel costs are driving some costs higher. Every product cost includes transportation which is affected by the cost of fuel. Excavators, dump trucks, and delivery trucks all are impacted. In addition, some products such as asphalt, plastics, and some insulations are made from petroleum. These material costs rise and fall with the cost of oil.

The construction industry in mid-2026 is mainly seeing escalation in Asphalt and shipping costs. Asphalt has a high oil component, and costs for paving have escalated. They are up $8 to $10 per ton this year. So far contractors are generally holding their bids from earlier in the year, but pressure is mounting as they receive new shipments of oil. Product delivery costs are increasing due to fuel costs. Most delivery trucks rely on diesel fuel which has increased from an average of $3.50 per gallon in January to $5.50 per gallon in April according to the Bureau of Transportation Statistics. This represents a 57% increase from January to June. Companies are adding fuel surcharges to their deliveries for concrete, drywall, wood and other products.

If the conflict surrounding Iran eases, fuel prices are expected to slowly fall. The U.S. Energy Information Administration projects crude prices slowly falling through the fourth quarter of 2026 which will be good news for the prices in the construction industry.

« back to listing