The Evolution Of Ups Fuel Index For Air Freight

The UPS fuel surcharge is a fee that the United Parcel Service (UPS) applies to shipments to adjust for changes in fuel prices. This surcharge is calculated as a percentage of the base rate and helps UPS maintain profitability despite fluctuations in fuel costs. UPS updates its fuel surcharge tables periodically, and the surcharge rates vary depending on factors such as the type of shipment, fuel prices, and geographical region. UPS also offers various shipping options and discounts to cater to different customer needs, including overnight shipping, budget-friendly options, and international services.

On March 14, 2022, UPS announced a change to the fuel surcharge for International Air-Export and International Air-Import services. This change took effect on March 21, 2022, and was based on the National U.S. Average On-Highway Diesel Fuel Price or the U.S. Gulf Coast (USGC) price for kerosene-type jet fuel. UPS continues to make adjustments to its fuel surcharges to align with fluctuations in fuel prices and market conditions.

UPS fuel surcharges for international air-export and air-import

UPS uses an index-based surcharge that is adjusted weekly for its International Air-Export and International Air-Import Fuel Surcharge. Changes to the surcharge are effective on Monday of each week. The surcharge is based on the U.S. Gulf Coast (USGC) price for kerosene-type jet fuel as most recently released by the U.S. Energy Information Administration (EIA) rounded to the nearest cent. For example, the surcharge for the week of March 21, 2022, is based on the USGC price for kerosene-type jet fuel released by the EIA the week of March 14, 2022.

The International Air-Export and International Air-Import Fuel Surcharge will be set in relation to the following table:

U.S. Gulf Coast (USGC) Jet Fuel Price (USD/Gallon)

Air-Export Surcharge

Air-Import Surcharge

Fuel surcharge percentages and thresholds are subject to change without prior notice. If the Fuel Surcharge falls outside the published range, the range will extend in $0.04 increments and the Fuel Surcharge will adjust in 0.25% increments.

For the released jet fuel pricing information, refer to the EIA's U.S. Gulf Coast (USGC) Jet Fuel Prices. If the jet fuel pricing information released by the EIA is delayed, UPS may use released jet fuel pricing information from an earlier week.

UPS Air Cargo utilizes a kerosene-type Fuel Price Index (FPI) reported on the US Department of Energy's website to calculate fuel surcharges. The surcharge will increase or decrease when the FPI passes trigger points for two consecutive weeks.

UPS fuel surcharges for domestic air

UPS uses an index-based surcharge for its Domestic Air Fuel Surcharge that is adjusted weekly. The surcharge is based on the U.S. Gulf Coast (USGC) price for kerosene-type jet fuel as most recently released by the U.S. Energy Information Administration (EIA) and is rounded to the nearest cent. For example, the surcharge for the week of March 21, 2022, is based on the USGC price for kerosene-type jet fuel released by the EIA for the week of March 14, 2022.

The Domestic Air Fuel Surcharge will be set in relation to the following table:

| U.S. Gulf Coast (USGC) Jet Fuel Price (USD/Gallon) | Fuel Surcharge |

|---|---|

| $2.740 - $2.889 | 10.25% |

| $2.890 - $3.039 | 10.50% |

| $3.040 - $3.189 | 10.75% |

| $3.190 - $3.339 | 11.00% |

| $3.340 - $3.489 | 11.25% |

| $3.490 - $3.639 | 11.50% |

| $3.640 - $3.789 | 11.75% |

| $3.790 - $3.939 | 12.00% |

| $3.940 - $4.089 | 12.25% |

| $4.090 - $4.239 | 12.50% |

| $4.240 - $4.389 | 12.75% |

| $4.390 - $4.539 | 13.00% |

| $4.540 - $4.689 | 13.25% |

| $4.690 - $4.839 | 13.50% |

| $4.840 - $4.989 | 13.75% |

| $4.990 - $5.139 | 14.00% |

| $5.140 - $5.289 | 14.25% |

| $5.290 - $5.439 | 14.50% |

| $5.440 - $5.589 | 14.75% |

| $5.590 - $5.739 | 15.00% |

| $5.740 - $5.889 | 15.25% |

| $5.890 - $6.039 | 15.50% |

| $6.040 - $6.189 | 15.75% |

| $6.190 - $6.339 | 16.00% |

| $6.340 - $6.489 | 16.25% |

| $6.490 - $6.639 | 16.50% |

| $6.640 - $6.789 | 16.75% |

| $6.790 - $6.939 | 17.00% |

| $6.940 - $7.089 | 17.25% |

| $7.090 - $7.239 | 17.50% |

| $7.240 - $7.389 | 17.75% |

| $7.390 - $7.539 | 18.00% |

| $7.540 - $7.689 | 18.25% |

| $7.690 - $7.839 | 18.50% |

| $7.840 - $7.989 | 18.75% |

| $7.990 - $8.139 | 19.00% |

| $8.140 - $8.289 | 19.25% |

| $8.290 - $8.439 | 19.50% |

| $8.440 - $8.589 | 19.75% |

| $8.590+ | 20.00% |

Fuel surcharge percentages and thresholds are subject to change without prior notice. If the Fuel Surcharge falls outside the published range, the range will extend in $0.05 increments and the Fuel Surcharge will adjust in 0.25% increments.

UPS fuel surcharges for international ground export and import

The UPS fuel index for international air changed on August 26, 2024.

UPS uses an index-based surcharge that is adjusted weekly for its International Ground Export and Import Fuel Surcharge. Changes to the surcharge are effective on Monday of each week. The surcharge is based on the National U.S. Average On-Highway Diesel Fuel Price as most recently released by the U.S. Energy Information Administration (EIA) and rounded to the nearest cent. For example, the surcharge for the week of March 21, 2022, was based on the National U.S. Average On-Highway Diesel Fuel Price released by the EIA the week of March 14, 2022.

The International Ground Export and Import Fuel Surcharge will be set in relation to the following:

National U.S. Average On-highway Diesel Fuel Price (USD/Gallon)

Fuel surcharge percentages and thresholds are subject to change without prior notice. If the Fuel Surcharge falls outside the published range, the range will extend in $0.12 increments, and the Fuel Surcharge will adjust in 0.25% increments.

For released diesel fuel pricing information, refer to the U.S. EIA's National U.S. Average On Highway Diesel Fuel Price. If the diesel fuel pricing information released by the EIA is delayed, UPS may use released diesel fuel pricing information from an earlier week.

UPS fuel surcharge calculation

The UPS fuel surcharge is a fee that the United Parcel Service (UPS) applies to shipments to adjust for changes in fuel prices. This surcharge is calculated as a percentage of the base rate and is added to the expense of each package. It covers additional fuel costs and ensures UPS remains profitable, even when fuel prices increase. The calculation of the UPS fuel surcharge takes into account several factors, including the type of shipment, fuel prices, and the geographical region of the shipment.

UPS uses an index-based surcharge that is adjusted weekly for its domestic and international services. The surcharge is based on fuel prices released by the U.S. Energy Information Administration (EIA) or other official sources, such as the Ministry of Natural Resources Canada. For ground services, the surcharge is based on the National U.S. Average On-Highway Diesel Fuel Price, while for air services, it is based on the U.S. Gulf Coast (USGC) price for kerosene-type jet fuel. These surcharges are updated weekly, with changes taking effect on Mondays. The surcharge percentages posted on the 90-Day Fuel Surcharge History table on the date of shipment will apply.

For UPS Express Critical services, the fuel surcharge is updated monthly and posted approximately two weeks prior to the effective date, which is the first Monday of each month. UPS Post Sales fuel surcharges are also updated monthly, with changes taking effect on the first Monday of the month.

UPS Trade Direct Cross Border services have their own fuel surcharge rates, which can be found on the UPS website.

The fuel surcharge calculation can be influenced by various factors, including the type of freight, the carrier's operating territory, and the prevalent fuel prices. The surcharge is usually calculated as a percentage of the net line haul charges or the shipment's sale price.

UPS fuel surcharges apply to all domestic and international transportation charges and certain other accessorial, value-added, and other charges.

UPS fuel surcharge changes

UPS fuel surcharges are applied to shipments to offset the costs associated with changing fuel prices for air or ground transportation. The surcharge is calculated as a percentage of the base rate and is adjusted frequently (weekly or monthly) based on the average fuel price, with the exact date of adjustment dependent on the shipment type and region.

Ground Domestic and UPS SurePost Fuel Surcharge

UPS Ground Domestic and UPS SurePost Fuel Surcharge is based on the National U.S. Average On-Highway Diesel Fuel Price and is adjusted weekly. Changes to the surcharge are effective on Monday of each week and are based on the fuel price from two weeks prior. For example, the surcharge for the week of March 21, 2022, was based on the fuel price for the week of March 14, 2022.

Domestic Air Fuel Surcharge

The Domestic Air Fuel Surcharge is based on the U.S. Gulf Coast (USGC) price for kerosene-type jet fuel and is also adjusted weekly, with changes effective on Mondays. Similar to the Ground Domestic surcharge, it is based on fuel prices from two weeks prior.

International Air Fuel Surcharge

The International Air Fuel Surcharge is adjusted weekly and is based on the USGC price for kerosene-type jet fuel. Changes are effective on Mondays of each week and are based on fuel prices from the preceding week.

Other Fuel Surcharges

UPS also implements fuel surcharges for other services, such as UPS Express Critical, UPS Trade Direct Cross Border, UPS Standard to/from Canada and Mexico, and UPS Air Freight. These surcharges are adjusted either weekly or monthly and are based on fuel prices from sources like the U.S. Energy Information Administration (EIA) or the U.S. Department of Energy.

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