The four major international express operators have left nearly all their fuel surcharges unchangedaround the world in August following a drop in July but a general downward trend is expected over
the next few months as oil prices tumble amid the turbulence in world financial markets.International air express fuel surcharges have risen and fallen in recent months in line withthe rise in oil prices earlier this year and the more recent decline.
In Europe, all four integrators left their August surcharges unchanged compared to July. TNTExpress has the highest surcharge in the region at 20.5 per cent this month, followed by FedEx at17.5 per cent and then DHL Express and UPS, both at 17 per cent.
In the USA, FedEx and DHL left their surcharges stable at 15 per cent while UPS is unchangedat 14.5 per cent.
Asia saw the only significant changes. UPS reduced its surcharge in the region from 22.5 percent in July to 22 per cent this month. FedEx cut its surcharge from 17.5 per cent last month to 17per cent for August in most of Asia, including Singapore, Hong Kong, China and Japan. In India itis unchanged at 19.5 per cent. DHL Express left its surcharge stable at 23.5 per cent while TNT isunchanged at 20 per cent.
The international air express fuel surcharges for August reflect the oil price level twomonths ago. The four leading express carriers calculate their surcharges based on indices showingthe previous month’s oil price level and announce them in advance for the following month. Thisresults in a two-month time lag between prices and the surcharge level.
Oil prices have been through ups and downs over the last few months after rising steadilyuntil April. Brent Crude, for example, dropped from the $115 level to below $110 in May, then roseagain to nearly $120 in June before dropping heavily to the $105 range. It then rose again in Julyto above $115 but has dropped sharply in August. Brent Crude was trading at about $105 per barreltoday. This fluctuation suggests a downward trend in fuel surcharges over the next few months butmakes precise forecasts extremely difficult.
