Why Diesel Hit $5.37 and What It Means for Your Shipping Costs

Diesel is over $5 a gallon again. That has pushed UPS and FedEx surcharge tables up twice already in 2026, and the same package shipped at the same base rate now costs more. Here is why diesel spiked and what to do about it.

Why diesel is back above $5

Three things drove the spring 2026 diesel spike:

U.S. refinery capacity has not kept pace with demand. Several Gulf Coast refineries cut output for spring maintenance, tightening supply.

Geopolitical disruption in the Middle East pushed crude oil prices higher, and diesel followed.

Tighter trucking capacity means carriers run more miles per load through deeper route guides, which burns more fuel per shipment.

The result is a per-gallon price that sits well above the levels UPS and FedEx originally built into their 2026 surcharge tables.

How that flows through to your shipping bill

Both UPS and FedEx peg their fuel surcharge to the U.S. Energy Information Administration (EIA) national on-highway diesel price. When diesel goes up, the surcharge percentage on every shipment goes up. Our breakdown of how fuel surcharges work walks through the math in detail.

Three knock-on effects you can see on your invoices right now:

UPS raised its surcharge table 1% in January 2026 and another 1% in March 2026. Surcharge bands now run from 21% up to 24%+ above $3.55 per gallon.

FedEx, UPS, and others added Middle East surcharges tied to disruption in international shipping lanes.

Surcharge percentages stack on top of accessorial fees like residential delivery, oversize, and additional handling, multiplying the impact on the final cost.

What SMB shippers should do right now

Diesel will move. Your strategy should not have to.

Lock in capacity before the next rate move

Spot rates are climbing as carrier capacity tightens. Booking inbound and outbound capacity through a 3PL with carrier relationships protects you from spot exposure when diesel jumps again.

Negotiate the base rate, not the surcharge

Surcharge percentages are public and apply across the carrier’s customer base. Your base rate is where you have leverage. A lower base rate makes every surcharge percentage smaller in absolute dollars.

Right-size packaging and addressing

Every dollar of accessorial fees gets a fuel surcharge applied on top. Right-sizing your packaging and routing through warehouses near your customer base shrinks both the base rate and the surcharge stack.

Use a 3PL with carrier rate discounts

Higher-volume 3PLs negotiate better base rates than most SMB shippers can get on their own, and pass those rates through to clients. More on how that works in 5 ways 3PL Center reduces your shipping costs.