Guide 3 of 11 · 6 minute read
Fuel caps: putting a ceiling on the surcharge
A cap protects your budget from the weeks that hurt most. Here is how to value one before you trade anything for it.
How a cap works
A cap sets the most you will pay in fuel surcharge, for example 26%, no matter how high the published rate goes. When the published rate is below the cap, the cap does nothing. When it is above, you pay the cap. A cap combined with a discount is worth checking carefully: the order in which they apply changes the result.
Valuing a cap with real history
The honest way to value a cap is to replay it against recent weeks: for each week, take the amount the published rate exceeded the cap and multiply it by that week’s spend. Our cap value tool does exactly that with the last 26 weeks of rates. A cap that would have saved nothing last year can still be worth having as insurance, but you should know which one you are buying.
Caps, collars and floors
Some carriers will only agree to a cap if you accept a floor: a minimum surcharge you pay even when diesel falls. The pair is called a collar. A collar trades upside protection for giving up some savings when fuel is cheap. Model both sides before agreeing.
What to ask for
- A cap stated in percentage points of surcharge, per service.
- Clarity on whether the cap applies before or after your fuel discount.
- No floor, or a floor well below current levels.
- A review trigger if the carrier changes its fuel table.
Key takeaways
- A cap only pays in weeks the published rate is above it.
- Replay a proposed cap against real weekly history before you trade for it.
- Watch for floors that come attached to caps.
By the Logistics Contract Optimizer team. Rates cited are from the week of November 2, 2026 unless stated; see the rate board for this week.