Home / Business and Economy / FedEx, UPS Hike Fuel Surcharges as Oil Prices Soar
FedEx, UPS Hike Fuel Surcharges as Oil Prices Soar
21 Mar
Summary
- Fuel surcharges now represent a significant portion of shipping costs.
- Diesel prices have risen over 30% compared to last year.
- Consumers shipping from retail stores face the highest surcharge percentages.
FedEx and UPS have notably increased their fuel surcharges in response to escalating oil prices, a trend driven by Middle East turmoil. This rise continues a pattern where fuel surcharges constitute an ever-larger share of total shipping expenses.
Data from ShipMatrix indicates that fuel surcharges averaged 19.4% of shipping costs in 2025, a substantial jump from 6.3% in 2020. During the initial weeks of March 2026, this percentage climbed even higher, reaching as much as 26% of the overall shipping cost.
Both companies state they revise their fuel surcharges weekly, basing adjustments on prices published by the U.S. Department of Energy. This week, diesel prices have exceeded $5 per gallon, marking an increase of over 30% from the previous year.
According to Satish Jindel, president of ShipMatrix, consumers utilizing retail shipping locations like FedEx Office and The UPS Store typically encounter the highest surcharge percentages. Conversely, businesses with negotiated contracts generally pay a lower percentage.
