Should You Be Paying Fuel Surcharges?

Should you be paying fuel surcharges? As gas prices start to rise again across the county, a strange charge has been showing up again on many of the services we use every day. I'm talking about fuel surcharges. They show up on everything from a cab ride, to a plane ticket, but what are you really paying for?

The average cost for a gallon of unleaded gasoline is $2.54 this week, up $.08 from last week, but down almost a $1.50 from last summer. In that same time, a postage stamp has gone from $.42 to $.44, the United Parcel Service (UPS) has increased their prices by 5.9%, in addition to a fuel surcharge of 2.75% as of June 1, 2009, and cabs in my city have been adding $.75 to each cab ride before you even move an inch. All of these rate hikes were taking place even when gas dipped below $1.50 a gallon earlier this year.

I understood the need for some of these surcharges last summer when gas prices were over $4.00, but now with the average at only $2.54, I think it's more like price gouging. It's the same thing with airlines. When oil hit $130.00 a barrel, an airline fuel surcharge was understandable, although not well liked. Now, with oil around half that, passengers are still being asked to pay this tax, and hardly anyone is asking any questions. I was booked on a flight from Philadelphia to Honolulu a few months ago, and the fuel surcharge was $200.00. Two Hundred Dollars! And that was when oil was $10.00 less than it is right now, and close to $90.00 less than it was last year. I'm almost afraid to fly!

The first time I noticed a fuel surcharge was when I sent something via UPS. It was a 2lb package that contained a t-shirt and a CD-Rom full of pictures from my nephews' birthday. The package was going from Delaware to New York City, and was set to arrive next day because of the proximity and was only going to cost about $12.00. I paid, but once I inspected my receipt, I noticed the surcharge. About $11.00 shipping with a $1.00 fuel surcharge. When I asked the clerk what it was for, he told me that they had put the surcharge in place due to the increased gas prices. I dismissed it because at the time, gas prices were high, and it was only $1.00. Then last November when I was sending out gifts to other family members, I noticed that the surcharge was still there. Gas prices at this time were much lower than the first time I used UPS to ship, and when questioned, the clerk could not explain why the charge was still there, only that it was "company policy."

So right now, all predictions say that gas prices will keep going up, so logic says that these fuel surcharges will continue to show up. And as the prices go from surcharges to part of the price, expect more surcharges to show up on top of that. Make it your responsibility to question where the charges are coming from, and if prices start to drop again, also question why the charges are still showing up.