Fuel surcharges for international air express shipments have further increased in May due tocontinuously rising oil prices over the last few months impacted by the ongoing conflicts in Arab
countries, CEP-Research analysis shows.For May, the fuel surcharges of the four leading express operators have all risen throughout theUSA, Europe and Asia. This is the latest in a series of increases since the start of this year.
In the USA, FedEx Express, UPS and DHL Express surcharges for domestic and international airexpress shipments all jumped from 13% in April to 15.5% in May.
In Europe, the US operators FedEx and UPS both increased their May surcharges to 17.5% from16.5% in April. DHL also increased its European fuel surcharge to 17.5% this month from 16% inApril. The TNT Express European surcharge also went up from 19.5% in April to 20.5% for May whileits separate UK surcharge increased to 14% from the previous 13%.
Similarly, all the integrators increased their fuel surcharges in Asia for May. The DHLsurcharge went up from 22% in April to 24% for the period of May 1 – June 4. UPS raised its Aprilsurcharge in Asia to 23% from 20.5% in April. The TNT ROW (rest of the world) surcharge rose from19% in April to 20% in May. FedEx, whose surcharges vary by country in Asia, went up to 18% in Mayfrom 15.5% in April both in Singapore and Hong Kong.
The air express fuel surcharges for May reflect the oil price level two months ago. The fourleading express carriers calculate their surcharges based on indices showing the previous month’soil price level and announce them in advance for the following month. This results in a two-monthtime lag between prices and the surcharge level.
The short-term outlook for surcharges, however, suggests they will stabilise or drop back in thenext few months due to falling oil prices.
Last week, oil prices experienced the biggest weekly decline since 2008 plummeting by nearly $13a barrel during one day below $110 a barrel for the first time since March following the continuousrise over the last few months.
Oil futures recovered somewhat again with oil trading just above the $100 mark with $100.04 abarrel on the New York Mercantile Exchange this morning which is still considerably lower than lastmonth’s prices. Brent futures in London also went down to $112.36 a barrel compared to over $120last month.
According to analysts’ expectations, prices could drop as low as $90 a barrel later this monthon concerns about global growth despite a stronger-than-expected US jobs report released lastFriday, according to US media.
