There isn’t a logistics drinking game (you’d let us know if there was one though, right!?) but if there was, ‘fuel surcharge’ would’ve been your downfall in 2026.

In February, the escalating conflict in the middle east saw prices surge at the bowser. Fuel is kind of a big deal in our industry, which is why we’d all be extremely dusty if that drinking game did exist. 

According to the State of Shipping Report, the top concern for carriers in 2026 is fuel price volatility. Almost half have already imposed fuel surcharges. 

However, it only takes a quick glance at Shippit’s fuel surcharge matrix - our centralised view of current fuel surcharge rates by carrier - to see some pretty sizable fluctuations. 

In this week’s Delivered, Yoni Sonnabend, Shipping Solutions Manager at Shippit, explains why surcharge rates vary, why carriers adopt different approaches to calculate theirs, and what happens when the fuel excise relief ends on 2 August.

TL;DR

• Carriers calculate surcharges differently, with some tracking current diesel prices and others hedging to lock in future rates
• Carriers have been planning for the end of the fuel excise relief for months before 2 August 2026, so businesses should expect less surcharge volatility and bill shock
• A multi-carrier strategy diversifies risk against fuel swings, and against tech outages, capacity crunches and service failures too
• Fuel volatility is an occupational hazard (not a one-off), so build carrier optionality while it's calm rather than during the next shock

Are businesses fixated on the wrong surcharge number?

As a Shipping Solutions Manager at Shippit, Yoni works with customers and carriers to optimise their delivery network. As you can imagine, he’s seen a lot of surcharges over the last ~six months. 

But, he explains, most businesses are making an immediate mistake when looking at fuel surcharges.

“The first thing you see when you look at those numbers is whose number is biggest," Yoni says. “But really the impact it'll be having on your bill is the change in those numbers.

“A 5% increase has the same impact, if that's from a small number or a very big number. The change is more important than the absolute number you see."

The size of that impact depends on your freight profile, Yoni explains. 

“Your cheaper shipments fluctuation will have a smaller impact, while your more expensive shipments will have a larger impact." 

A surcharge moving on a heavy interstate lane costs you more than the same percentage on a metro satchel.

So why do the absolute numbers differ at all? Because a fuel surcharge measures change over time, and carriers start measuring from different points. 

A carrier that started tracking when fuel was cheap shows a bigger jump than one that started tracking when it was already high. The headline tells you how far that carrier has moved from its own baseline, not what it costs to ship today.

Why do carriers use different methods to calculate surcharges?

The other reason surcharges differ comes down to how each carrier buys fuel.

“It really comes down to each carrier's internal practices," Yoni says. “The main difference is that some carriers reflect the current national diesel rates while others use financial instruments to effectively lock in future fuel rates."

For carriers that peg to current national diesel prices, what you see is what you get. Costs would’ve surged in late March, when conflicts escalated, before stabilising at the introduction of the fuel excise relief.

But for those that lock in future fuel prices, it cuts both ways.

This also explains how some carriers can quote their surcharge two months out, while other carriers update theirs on a weekly basis. 

Those locked rates are priced to expected cost, and may not match where fuel lands. When prices fall, hedging hurts. But when they rise, it’s better for both the carrier and the businesses that rely on them.

“If the expectation is for prices to remain higher but they end up falling, carriers that have been hedging have paid significantly for that expectation. There'll be an inflated cost they're paying."

None of this is perfectly transparent. A carrier might absorb costs to stay competitive, or move opportunistically. 

“It's their pricing strategy, to see how much of that increase they're willing to absorb. If they're absorbing more, they'll be more competitively priced and more likely to win orders."

How should you compare two different fuel surcharges?

So if the surface level figure isn’t the right number to look at and carriers buy fuel differently, how do you compare two costs? You stop looking at the surcharge in isolation and look instead at the total cost of freight.

“You need to compare the total cost, inclusive of base and fuel components," Yoni says. “A carrier might have a cheap base but a more expensive fuel surcharge, and that could be comparable to a carrier with a more expensive base and a smaller surcharge.

What happens when the fuel excise relief ends?

One of the biggest questions over the last few weeks, was what will happen when the temporary fuel excise relief ends.

Originally due to end on 30 June, the government extended fuel excise relief through to 2 August 2026, halving the previous discount to 16 cents per litre for petrol and diesel. This saves motorists around $11 per 65-litre tank. The Heavy Vehicle Road User Charge is also reduced by 16 cents for the same period.

During April, May and to a lesser extent June, surcharges moved at different times for different carriers, and orders swung between them. A known excise change should create less volatility and produce a more uniform response.

“We don't expect to see the same dynamic [as the start of the fuel crisis], because the outcome was known," Yoni says. 

“The markets had been pricing these changes in, which is why we likely won’t see that piece where expectations differ from reality. There will be less volatility, and everyone should move more in unison."

However, due to partial tax rebates, it’s not as straightforward as a clean pass through from fuel costs to surcharge rates. 

So the relief ending is not a single clean number landing on every invoice on 2 August. It is a known increase, dampened by tax credits, filtered through each carrier's pricing decision.

The remaining 16 cents per litre of relief expires on 2 August, but the government has already extended it once, and cost-of-living pressures haven't eased. A further extension or a staged return is a real possibility, so the ‘cliff’ may become a gentler slope. 

Whether full excise returns could be as much a Canberra decision as an oil-market one. If it does lapse, diesel bowser prices could jump around 17 to 18 cents per litre with GST overnight. 

Gasoil has already fallen roughly 17% from its 2026 highs as the conflict premium unwinds, which gives diesel modest room to ease. But April showed how fast that can reverse.

The geopolitical situation remains volatile. So the question becomes, how can businesses navigate the uncertainty?

How can businesses navigate the volatility?

A business tied to a single carrier is beholden to that carrier's rates, hedging decisions, and pricing strategy. A business running several has contingency, and the flexibility to divert volume elsewhere if one carrier increases their rate. 

There is also leverage, Yoni explains: “If carriers see you're splitting orders with others, there's a drive to reduce their rates to meet the market. They're less motivated to do that if you're giving them everything.

“We've seen oscillations over the last couple of months between which carriers are allocated orders, in line with whether their fuel prices moved up or down. When one carrier's surcharge climbs and another holds, more of your volume routes to the cheaper option.”

The temptation in a few months, if the fuel crisis eases, is to breathe a sigh of relief, and move on. But the next disruption is lying in wait, and proactivity pays. 

“There's a lag. You can't decide to do it the same day and expect the carrier to turn up. You build the diversity before you need it, not during the shock.”

What should logistics leaders do now?

Don’t treat the fuel crisis as a near miss, treat it as a warning. 

• “Review your carrier allocations, and whether you've got specific rules set up for specific carriers to win orders, maybe it's by location, or maybe there's certain service rules that you've created,” Yoni says. “Having more carriers compete for these orders effectively diversifies your risk against those fuel changes, and particularly the disparity between how the carriers pass on those fuel costs." But remember: compare the total cost of freight. A cheap base with a high surcharge can beat an expensive base with a low one.
• Check your rules engine. When did you last review it? Make sure orders are piped to the best carrier on a full range of criteria, cost included.
• Add carriers before you need them. The lag means you build diversity ahead of the next shock, whether that is fuel, a cyber attack, a capacity crunch or a service failure.

Fuel surcharges are one symptom of a volatile industry - but tomorrow there could be another theme in the logistics drinking game. Those that navigate the volatility, in whatever form it appears, will be those that plan for it.

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