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10/11/2002



Rail News: Rail Industry Trends

CSXT, NS ready to reinstate fuel surcharge if crude-oil prices fail to fall


Although CSX Transportation and Norfolk Southern Corp. haven't added a fuel surcharge to shippers' waybills for nearly a year, rising crude-oil prices could change that Oct. 17.


If West Texas Intermediate (WTI) crude-oil prices remain above $28 per barrel through Oct. 15 (for a total of 30 consecutive days), the Class Is plan to begin adding a 2 percent fuel surcharge to customers' freight bills two days later.


For every $5 that WTI prices rise above $28 per barrel for 30 consecutive days as published in the Wall Street Journal, the railroads would add a 2 percent recovery charge. (WTI is the industry standard for tracking crude-oil prices.)


WTI per-barrel prices between $28 and $32 would result in a surcharge of 2 percent; between $33 and $37, 4 percent; and between $38 and $42, 6 percent.


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