Why Your Freight Bill Keeps Changing: How Fuel Costs Are Driving Shipping Rates in 2026

Allan Brizuela

2 days ago

3 min read

If your freight quotes have felt unpredictable this year, fuel is the main reason. Whether your cargo moves by air, sea or truck, fuel is one of the biggest costs in the move, and 2026 has been one of the most volatile years for fuel prices in a long time. Here's what's happening and what it means for your shipments.

A year of fuel shocks

On the road. Philippine pump prices have swung sharply since the Middle East conflict began in late February. At the worst point, diesel sold for more than ₱160–₱170 per liter in some segments. Prices have eased since then but are still well above where they started. As of October 12, diesel was up a net ₱64.83 per liter for the year, and this week brought another diesel increase of ₱2.60 per liter from at least one major oil firm, linked to low global diesel stocks. Every peso added at the pump flows into trucking and delivery rates.

In the air. Jet fuel prices more than doubled in a month. The global average went from about $96 per barrel in late February to $197 by March 20. Prices remain high: IATA's monitor showed jet fuel more than double its level of a year earlier as of October 9. Because fuel makes up roughly a quarter to nearly a third of an airline's operating costs, these increases go straight into cargo rates.

At sea. Ocean carriers are feeling it too. As of October 6, the average price of very low sulfur fuel oil (VLSFO) across 20 major ports was $876.50 per tonne. Forecasts have also gone up. Ship & Bunker now expects VLSFO to average $882 per tonne in Q4, compared with its August forecast of $646.

How fuel shows up on your invoice

Carriers usually don't build fuel into the base rate. Instead, they add separate surcharges that move with fuel prices:

Bunker Adjustment Factor (BAF) for sea freight. For example, CNC's intra-Asia BAF from October 1 is $135 per 20-foot container and $270 per 40-foot container. Some carriers use other names; Maersk, for instance, calls its charge a Fossil Fuel Fee on new contracts longer than three months.
Fuel surcharge (FSC) for air freight. In the Philippines, the Civil Aeronautics Board temporarily moved to a 15-day review cycle for fuel surcharges instead of the usual monthly one, so these charges can change twice a month. For September 1–15, the approved range for international cargo was ₱7.18 to ₱53.39 per kilogram.
Fuel-adjusted trucking rates for pick-up, delivery and inland transport.

Because surcharges are updated more often than in the past, two quotes for the same shipment just a few weeks apart can differ, even if the base rate hasn't changed.

What this means for Q4

Fuel costs are hitting just as the holiday peak season builds. The US Energy Information Administration raised its Q4 Brent crude forecast to $104.69 per barrel. That means fuel-related charges are unlikely to drop significantly before the end of the year.

How to manage fuel-driven costs

Check the validity date on your quote. Fuel surcharges have effective dates. Confirm how long your quoted rate is good for before you commit.
Book early. Locking in space and rates sooner protects you from mid-season surcharge increases.
Choose the right mode. If your cargo isn't urgent, sea freight is usually far less exposed to fuel swings per kilo than air freight.
Consolidate shipments. Fewer, fuller shipments spread fuel costs over more cargo.
Talk to your forwarder about longer contracts. Ask how often the fuel factor is reviewed and how it's calculated, so there are no surprises.