What is a fuel surcharge and how is it calculated?
Fuel is a one of the major expenses associated with getting your shipment from point A to point B. When the price of fuel goes up significantly a carrier must charge more to maintain their profit margin. If there is some uncertainty as to when the price will stabilize, carriers will add a fuel surcharge to their base rate. If the new, higher price seems to stabilize, then carriers will eventually remove the surcharge and just quote a higher general price. If the price goes back down to previous levels the surcharge can be removed without the carrier needing to adjust their basic rates. Over the last several years, the price of diesel fuel has gone from $1.20 per gallon to as high as $4.00 per gallon (following hurricane Katrina). It has generally been staying between $2.50 and $3.00 per gallon as a national average. The price of diesel fuel has not stayed at one level long enough for the trucking industry to adjust rates and remove fuel surcharges. Most trucks will average around 5 mil
