Fuel surcharges for international air express shipments have increased in February due to risingoil prices in recent months and could go higher in the short term as the unstable political
situation in Egypt puts further upward pressure on oil prices, CEP-Research analysis shows.In February, the fuel surcharges of the four leading express operators have all risen acrossUSA, Europe and Asia.
In the USA, FedEx Express, UPS and DHL Express surcharges for domestic and international airexpress shipments all increased from 9% in January to 10% this month.
In Europe, UPS and DHL both increased their February surcharges to 14.5% from 14% in January.FedEx also raised its surcharges for the period of February 7 – March 6 to 15% from 14.5% lastmonth. The TNT Express European surcharge also went up from 17.5% in January to 18% this monthwhile its separate UK surcharge increased to 10.5% from the previous 10%.
Similar to the overall trend, all the integrators increased their fuel surcharges in Asia forFebruary. The DHL surcharge went up from 18.5% in January to 19.5% for the period of February 6 –March 5. UPS raised its February surcharge in Asia to 17.5% from 16%. The TNT surcharge also wentup to 18% in February from 17.5% last month. FedEx, whose surcharges vary by country in Asia, wentup to 12.5% in February from 11% last month both in Singapore and Hong Kong.
The air express fuel surcharges for February reflect the oil price level two months ago. Thefour leading express carriers calculate their surcharges based on indices showing the previousmonth’s oil price level and announce them in advance for the following month. This results in atwo-month time lag between prices and the surcharge level.
After rising considerably during December and January to over $90 a barrel, oil prices surged to$92.19 on Jan. 31 in New York, the highest level since October 3, 2008, on concern Egyptian unrestwould disrupt shipments from the Middle East. Brent futures climbed above $100 a barrel, reachingat $102.34 on February 2, the highest since September 26, 2008, Bloomberg reported.
However, oil prices have fallen back again in recent days as political tension in Egypt easedand rising stockpiles in the USA signalled that fuel demand may be faltering. On the New YorkMercantile Exchange, oil was down at $87.48 a barrel this morning while Brent Crude oil in Londonrose to $99.62 a barrel.
According to Reuters, the tension in Egypt will continue to support oil prices but they are nowconsolidating, slightly below their previous levels, with Egypt unable to drive the prices upwardsanymore. But the insecurity related with it prevents further declines, the news agency reported.
