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<< Rail News Home: Mechanical

11/20/2006    Factoring Fuel



Rail News: Mechanical

CN's fuel surcharge to go down on New Year's Day




Canadian National Railway Co. customers will be ringing in more than the new year on Jan. 1, 2007. That day, the railroad’s fuel surcharge will decrease — the third surcharge reduction since CN introduced “Tariff 7401” in April 2005.

Based on a West Texas Intermediate (WTI) crude oil price level of $60 per barrel, the Class I’s new fuel surcharge would be 9.32 percent compared with 10 percent under the current tariff. The new surcharge will be the North American rail industry’s lowest based on a WTI price per barrel of $25, CN said.

“This latest reduction reflects our commitment to fair pricing,” said James Foote, CN executive vice president of sales and marketing, in a prepared statement. “We apply the surcharge to our customer base as broadly as possible.”

For each oil price fluctuation of $1 per barrel above $25 per barrel, the railroad’s fuel surcharge will decrease or increase by 0.23 percent, or 8 percent lower than the 0.25 percent stipulated by current Tariff 7401, CN said.




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