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New USPS Fuel Surcharge Will Make Mailing Packages More Expensive Through 2027
By Pete Grieve MONEY RESEARCH COLLECTIVE
The U.S. Postal Service called its 8% surcharge “a time-limited price change to better align its costs of transportation with the market.”
The next time you go to mail a package, be ready to pay up: The U.S. Postal Service’s governing board approved temporary price increases for package shipping set to take effect in one month.
On Wednesday, the USPS confirmed it is adding 8% surcharges for Priority Mail services, Ground Advantage and Parcel Select shipping. The announcement comes as fuel costs are spiking, with the national average for diesel fuel — on which the agency’s long-haul trucks run — at $5.38 per gallon, up from $3.76 a month ago, according to AAA.
The USPS described the surcharge as “a time-limited price change to better align its costs of transportation with the market.” But, in a warning that’s perhaps scarier for cost-conscious Americans, the announcement also acknowledged that the surcharge could be a “bridge to a permanent mechanism to reflect market conditions in prices.”
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Democratic officials immediately responded, calling out the growing consumer impacts from the Iran war — now in its fourth week — which has sent oil and gas prices soaring globally.
“Groceries. Gas. Now packages. Is there anything Donald Trump hasn’t made more expensive?” Illinois Gov. JB Pritzker wrote on X. “Call it what it is: the Trump Mail Tax.”
In its statement, the USPS defended the price increases, which still need final approval before implementation.
“Transportation costs have been increasing, and our competitors have reacted with a number of surcharges,” the statement said. “This charge is less than one-third of what our competitors charge for fuel alone, so even with this change, the Postal Service continues to offer great value.”
FedEx and UPS have long charged fuel surcharges, and those surcharges have increased significantly since the Iran war began, according to the Wall Street Journal.
The USPS chose to hold stamp prices at 78 cents in January. It did, however, hike other postage and shipping rates that month, including price increases of 5.1% to 7.8% for the services that were just hit with the additional 8% surcharge (Priority Mail, Priority Mail Express, USPS Ground Advantage and Parcel Select).
Before the recent fuel price spikes, the USPS had pointed to challenges including rising labor costs, coupled with long-term funding deficits.
The agency has said higher prices are necessary to restore financial stability. If approved by the Postal Regulatory Commission, the new surcharge for package shipping will be in effect from April 26 to Jan. 17.
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Pete Grieve is a New York-based reporter who covers personal finance news. At Money, Pete covers trending stories that affect Americans’ wallets on topics including car buying, insurance, housing, credit cards, retirement and taxes. He studied political science and photography at the University of Chicago, where he was editor-in-chief of The Chicago Maroon. Pete began his career as a professional journalist in 2019. Prior to joining Money, he was a health reporter for Spectrum News in Ohio, where he wrote digital stories and appeared on TV to provide coverage to a statewide audience. He has also written for the San Francisco Chronicle, the Chicago Sun-Times and CNN Politics. Pete received extensive journalism training through Report for America, a nonprofit organization that places reporters in newsrooms to cover underreported issues and communities, and he attended the annual Investigative Reporters and Editors conference in 2021. Pete has discussed his reporting in interviews with outlets including the Columbia Journalism Review and WBEZ (Chicago's NPR station). He’s been a panelist at the Chicago Headline Club’s FOIA Fest and he received the Institute on Political Journalism’s $2,500 Award for Excellence in Collegiate Reporting in 2017. An essay he wrote for Grey City magazine was published in a 2020 book, Remembering J. Z. Smith: A Career and its Consequence.