Major airlines are raising fuel surcharges due to soaring jet fuel prices linked to the Iran war and Strait of Hormuz closure, impacting global logistics.
United Cargo, Air Canada Cargo, and Cathay Cargo are among airlines introducing fuel surcharges to offset rising jet fuel prices caused by the Iran war and the closure of the Strait of Hormuz, reports Washington, DC's Supply Chain Dive.
US Gulf Coast jet fuel prices reached US$4.03 per gallon on April 27, nearly double last year's levels, according to the US Energy Information Administration. Xeneta reported that air freight rates from Asia to North America rose by double digits as carriers faced higher costs and rerouting pressures.
United Cargo will impose a 'Market Disruption Fee' from May 1, with Asia Pacific shipments charged up to 55 cents per kilogram. Chief executive Scott Kirby stated that some routes may be cut as fuel costs make them unprofitable, reducing bellyhold capacity and slowing growth plans.
Air Canada Cargo introduced an 'Airfreight Carrier Surcharge' on April 27, with different levels for short-, medium-, and long-haul flights. The carrier indicated that the surcharge would be reviewed regularly as market conditions shift. Cathay Cargo is revising surcharges every two weeks, noting that its fuel hedging covers only 30 percent of crude oil costs.
ANA Cargo and Lufthansa Cargo also adjusted surcharges to reflect the spike in fuel prices. Lufthansa stated that its air freight surcharge accounts for volatility in fuel, currency, and flight-dependent costs. Logistics provider Rhenus warned that rerouting and limited fuel availability are reducing payloads and reliability.
Beyond air cargo, ocean carriers MSC, CMA CGM, Ocean Network Express, and Maersk have raised rates. Trucking diesel prices remain elevated, and UPS added a 'Surge Emergency Fee' on April 19, underscoring how fuel volatility is rippling across global supply chains.
