In one aspect, a method for reducing fuel consumption of a work vehicle is disclosed. The method may generally include determining, with a controller, a load power requirement for the work vehicle, determining a plurality of candidate engine speeds at which the load power requirement is achievable, analyzing stored efficiency data for a transmission and at least one additional component of the work vehicle to determine a power loss value for each candidate engine speed, determining a candidate engine power for each candidate engine speed based on the load power requirement and the power loss values and analyzing stored fuel efficiency data based on the candidate engine powers to determine a target engine speed for the work vehicle.