Fuel spiked and your margins are gone

The fuel spike hits the job you already signed

When diesel jumps overnight, the hurt is not theoretical. It lands in the jobs already booked, the plant you have already hired and the runs you still have to make. If you quoted tight, the margin can disappear before the week is out. The first question is simple: did the contract give you any room to adjust price if costs moved?

A customer’s accepted quote becomes a binding contract, so the wording you already agreed to matters. Business.gov.au says it is safer to have changes in writing, and that a contract variation should be clearly recorded and signed by both sides. If the paper is silent on fuel, you may be negotiating from scratch rather than relying on an automatic increase. ([business.gov.au](https://business.gov.au/people/contractors/prepare-quotes?utm_source=openai))

Find the clause before you talk numbers

Pull out the signed quote, subcontract or head contract and look for anything that deals with variations, price reviews, cost escalation or fuel recovery. Some contracts allow a fee review when business costs rise. Others require the parties to agree any change in writing. That detail matters, because the right process is usually just as important as the right amount.

If there is a fuel clause, check exactly what it covers. Does it apply to diesel only, or broader transport costs as well? Does it require notice within a set time? Does it call for invoices, a published index or a calculation method? If the clause is narrow, do not assume it will stretch far enough to save the whole job. ([business.gov.au](https://business.gov.au/people/contractors/prepare-a-contract?utm_source=openai))

Source: Official guidance

Cost the impact before you ask for help

Do the maths in the same way you run the job. Separate fuel used for plant, trucks and any subcontracted haulage. Compare the allowance you priced against the real litres, kilometres or hours now being burned. A vague complaint about high fuel will not carry much weight. A clean sheet showing the extra cost per load or per hour will.

Business.gov.au says good quotes should include all costs and a fair margin. That is the test now. If the current fuel rate wipes out the margin, you need to know by how much and on which jobs. Put the original allowance, the new cost and the shortfall in one place so the client sees a commercial problem, not a mood. ([business.gov.au](https://business.gov.au/people/contractors/prepare-quotes?utm_source=openai))

Raise the issue early and in writing

Once you have the numbers, contact the client before the loss grows into a dispute. Keep it factual. Say what has changed, which clause you are relying on, and what adjustment you are seeking. If there is no clause, frame it as a proposal to vary the contract rather than a demand. That keeps the conversation open and the paperwork clean.

Put every agreed change in writing and get both sides to sign it. Business.gov.au notes that contract changes are best documented this way, and that a court can enforce a variation that both parties have agreed to. If the client will not accept the extra cost, you need to decide quickly whether the work still makes sense on the old price. ([business.gov.au](https://business.gov.au/people/contractors/prepare-a-contract?utm_source=openai))

Reset the next quote before the next shock

Do not let one bad fuel spike drag the next five tenders down with it. Update your standard pricing so diesel, transport and plant use are priced properly from the start. For long jobs, build in a review clause or a fuel allowance. Shorten quote validity if your market moves fast. The aim is to stop funding future work with yesterday’s numbers.

Before you send the next quote, decide whether you can afford to absorb another jump. If not, say so in the terms, not in the profit and loss after the fact. CRP coordinates independent qualified professionals who can help you review the contract, prepare the client conversation and reset the turnaround plan for new work. This is general information only and not a promise of outcome. ([business.gov.au](https://business.gov.au/people/contractors/prepare-quotes?utm_source=openai))