Fuel Surcharge
A fuel surcharge is a percentage added to transportation charges that moves with published diesel or jet fuel price indexes.
Why it matters for ecommerce brands
The fuel surcharge is one of the largest add-ons on a parcel or freight bill, and because it is a percentage, it grows with every rate increase and surcharge. UPS and FedEx reset their percentages weekly from published diesel and jet fuel indexes, and USPS applied a time-limited 8% transportation-related price increase from April 26, 2026, to January 17, 2027. For example, a $10 ground rate plus $6 of residential and area surcharges at a 20% fuel surcharge adds $3.20 per package, or $32,000 on 10,000 packages. Negotiate fuel discounts, not just base rates.
Origin
Fuel surcharges spread through US freight during the oil crises of 1973 and 1979, when carriers began tying an extra charge to diesel prices; parcel carriers now index it weekly.
Common questions
- How often do fuel surcharges change?
- UPS and FedEx adjust fuel surcharge percentages weekly based on published fuel price indexes. The percentage is applied to the base rate and many other surcharges.
- How is a carrier fuel surcharge calculated?
- Carriers publish a table that maps a weekly fuel price index, diesel for ground and jet fuel for air, to a percentage. That percentage is multiplied by the transportation charge and most surcharges on each shipment.
- Does USPS charge a fuel surcharge?
- USPS has not used a separate fuel surcharge line, but it applied a time-limited 8% price increase to Priority Mail Express, Priority Mail, Ground Advantage, and Parcel Select from April 26, 2026, to January 17, 2027, citing transportation costs. It is built into postage prices.