Fuel surcharges for international air express shipments continue to fall this month, with DHLcutting its US surcharge to zero in a dramatic response to the slump in oil prices, CEP-Research
analysis has shown.In the USA, DHL took an exceptional measure reducing its surcharge from 4.5% in January to 0%this month. FedEx and UPS didn’t follow this dramatic step, although the FedEx surcharge also fellfurther to reach a low of 3.5% in February, down from 4.5% in January. Similarly, the UPS surchargeexperienced a considerable drop from 7% to 5% this month.
In Europe, UPS was the only integrator to slightly raise its surcharge from 11.5% in January to12% this month. In contrast, FedEx and DHL both reduced their surcharges to 12% in February, downfrom 14.5% last month. TNT also reduced its European surcharge from 16.5% to 15% this month.
In Asia Pacific, all the four integrators reduced their surcharges. The UPS and FedEx surchargesboth fell quite dramatically from 15% in January to only 11% this month. Similarly, the DHLsurcharge also fell by four percentage points to 13% in February, down from 17% last month. TNT’sAsian surcharge dropped from 16.5% to 14.75% this month.
Global oil prices experienced some ups and downs over the last month still showing a downwardtrend overall. WTI crude further dropped to $48.24 a barrel this morning, down from over $52.50 amonth ago. Similarly, Brent crude slumped from nearly $60 a barrel in the beginning of January to$52.99 this morning. Compared to July 2014 when Brent crude traded at $115 and WTI crude above$103, oil prices have fallen dramatically by around 50%.
What additionally dragged down the oil prices was the slowing manufacturing growth in China,which shrank in January, for the second month in a row, indicating a general slowdown in thecountry’s economy. Crude oil also fell on a strike that started yesterday at nine US refineriesproducing 10% of the country’s gasoline after contract negotiations failed over salaries and safetyconcerns.
However, last Friday there was an 8% rise in Brent crude, the largest one-day percentage gainsince April 2009, supported by a sharp decline in the number of drilling rigs deployed in the USA.Analysts expect a possible 30-40% fall in North American drilling rigs this year, along withspending cuts by oil companies, which should help oil prices recover by the end of the year.
The air express fuel surcharges for February reflect the respective oil price levels two monthsago. The four integrators 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 the fuel price and surcharge change.
