Re: Oil Prices

Posted by 720Deere on August 12, 2005 at 18:46:59 from (70.22.61.233):

In Reply to: Re: Oil Prices posted by [email protected] on August 12, 2005 at 07:53:39:

Fuel surcharges are a real and fair way for companies to provide competitive pricing yet recoup any loses that they may suffer due to fuel price increases. That being said, the UPS surcharge is bogus!

Here is why I feel that way: I work for a very large heavy construction company. Our fuel usage peaks at as much as 30,000 to 40,000 gallons per day. We buy all of our fuel through market futures. Right now we are paying $1.147 for off-road diesel fuel. Add $0.47 per gal for taxes and you have road fuel. UPS uses much more fuel in a day than we probably use all year long. You better believe that they have their prices locked in for an extended period of time. Eventually the allocation will run out and prices will be adjusted. At that point, the surcharge is real, but until then it is pure profit!

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