The United States Postal Service is reportedly preparing to implement a fuel surcharge on package deliveries for the first time in its history, as rising fuel prices and ongoing financial challenges continue to strain the agency.
According to a report by The Wall Street Journal, USPS is planning to introduce an 8% fuel surcharge beginning in April. The surcharge is expected to be temporary, with plans to phase it out by January 2027. The additional fee would apply only to package deliveries and would not impact traditional letter mail.
The move would align USPS with competitors such as FedEx and UPS, which have long used fuel surcharges that adjust with fuel prices. Those surcharges have increased in recent weeks as oil prices surged due to disruptions in global supply.
Fuel costs have risen sharply, with diesel prices reaching $5.366 per gallon this week—an increase of more than 43% from $3.749 just one month ago.
The proposed surcharge comes as USPS faces mounting financial pressure. Postmaster General David Steiner recently warned lawmakers that the agency could run out of cash within a year without significant changes.
During testimony before a House Oversight subcommittee, Steiner outlined several measures aimed at stabilizing the Postal Service. These include raising stamp prices, increasing borrowing authority, and making changes to pension funding, workers’ compensation, and retirement investment strategies.
USPS has already reached its current borrowing limit of $15 billion, preventing it from taking on additional debt. Expanding that borrowing capacity has been identified as a key step to maintaining operations.
Additional cost-cutting options under consideration include reducing delivery from six days a week to five, which could save an estimated $3 billion annually, and closing smaller post offices in remote areas, potentially saving about $840 million each year. However, those changes are expected to face resistance from both lawmakers and the public.
The Postal Service has struggled financially for years, reporting a total of $118 billion in net losses since 2007. Much of the decline has been driven by falling volumes of first-class mail, which have dropped to levels not seen since the late 1960s.
At the same time, postage rates have steadily increased. Since early 2019, the price of a first-class stamp has risen 46%, from 50 cents to the current 78 cents. Despite these increases, USPS leadership maintains that U.S. postage rates remain lower than those in many other countries.
The proposed fuel surcharge represents another step by USPS to offset rising operational costs while continuing to provide nationwide service.
