Then again, the short line operator knows that if the price of diesel goes down, you will switch back to trucks. This will leave him with either too much physical plant, or having to lay off employees, or both. Looming over this whole thing is the 10,000 pound monkey in the room, government re-regulation. Add to this the promise of increased capital gains, and the depression that would cause, you can see how a small operator may just want to go back to playing trains.

The good news for the rail industry is that China just bought a 1% interest in British Petroleum (BP). This is probably the most significant news event since the end of WWII.