Union Pacific Billed $132 Million More in Fuel Surcharges Than It Spent on Fuel in Q3 2026 (STB Data)

Union Pacific billed $1,170.8 million in fuel surcharges and spent $1,039.0 million on fuel in the quarter ending Sep 30, 2026, according to the report it filed with the Surface Transportation Board (STB). The difference is $131.8 million: surcharge revenue was 112.7% of fuel cost (1,170,806 / 1,039,012, in $ thousands).

The Union Pacific filing is dated October 30, 2026 and signed by Carrie Powers, Vice President, Controller, and Chief Accounting Officer. It is the largest gap in Union Pacific's favour since Q3 2022. It is not proof of profit on any shipment, for reasons set out below.

Each Class I railroad files the same one-page form every quarter. Line 1 is total fuel cost, line 2 is gallons consumed and line 4 is total revenue from fuel surcharges. In Q3 2026 three railroads billed more in surcharges than they spent on fuel, and three billed less.

Taken together, the six railroads billed $63.7 million less in surcharges than they spent on fuel (98.1%). BNSF accounts for the shortfall: its surcharges were 78.9% of its fuel cost. The CSX filing is signed 10/28/2026.

Line 5 of the form reports surcharges on regulated traffic only. For Union Pacific in Q3 2026 that was $99.6 million, or 8.5% of its surcharge revenue (99,634 / 1,170,806). The rest was billed on other traffic.

We read every Union Pacific and BNSF filing from Q1 2014 to Q3 2026, 51 quarters each. Earlier filings are PDFs that we did not use, so nothing here speaks to the years before 2014.

Union Pacific's surcharges were below its fuel cost in all 33 quarters from Q1 2014 to Q1 2022. They have been above it in 13 of the 18 quarters since. The recent run: −$12.0 million (98.0%) in Q3 2025, −$34.8 million in Q1 2026, +$91.1 million (109.7%) in Q2 2026 and +$131.8 million (112.7%) in Q3 2026. The high point of the 51 quarters is +$220.3 million (123.6%) in Q3 2022.

Both directions matter. From Q2 2022 to Q3 2026, Union Pacific's surcharge revenue exceeded its fuel cost by a net $733.0 million. Over all 51 quarters it fell short by $4,778.7 million.

BNSF's surcharge revenue was below 100% of its fuel cost in all 51 quarters from Q1 2014 to Q3 2026. Its highest quarter was 85.0% in Q3 2022.

Union Pacific publishes one of its programs, the carload rate-based standard surcharge, on its website. The basis is the EIA US average on-highway diesel price for a calendar month. In Union Pacific's words (page read Nov 13, 2026): “In the event the average monthly price of Retail On-Highway Diesel Fuel, equals or exceeds $1.35 per gallon, a surcharge beginning at 1.5% will apply. For every five-cent increase above $1.35 per gallon, the surcharge applied will increase by 0.5%.”

The timing rule is the part that matters here. The surcharge is billed “beginning the second month following the month on which the DOE average price calculation was based.” So October's diesel price sets December's surcharge.

Union Pacific's table shows 50.5% for Dec 2026, based on an October 2026 average of $6.252 a gallon, and 50.5% for Nov 2026, based on $6.291 in Sep 2026. That September figure is the highest monthly average in EIA's monthly diesel series, which starts in 1994 (release of Nov 10, 2026). EIA's weekly price was $6.127 for the week of Nov 9, 2026, already below the October average that December's surcharge will use.

This page uses the public tariff program only. Union Pacific says the program does not affect its intermodal surcharge program, and contract and intermodal surcharge programs are private: we have not seen them and cannot say what share of the $1,170.8 million came from each.

A lagged index pays the railroad when diesel is falling and costs it when diesel is rising. In Q3 2026 diesel was rising. The surcharges applied in Jul, Aug and Sep 2026 used the May, Jun and Jul averages, which mean $5.193 a gallon. Diesel in Jul, Aug and Sep itself averaged $5.569 (EIA monthly, release of Nov 10, 2026).

On the published table, the applied rates were 44.0%, 38.0% and 37.5%, an average of 39.8%. Had each month used its own diesel price, Union Pacific's formula gives 37.5%, 42.5% and 50.5%, an average of 43.5% (OPA calculation from the rule quoted above). The lag lowered the published rate in Q3 2026. It does not explain a ratio of 112.7%.

Q3 2022 was the opposite case. The May, Jun and Jul 2022 averages mean $5.604 a gallon; Jul, Aug and Sep 2022 averaged $5.164. A two-month-lagged index sat $0.44 above the current price in the quarter when Union Pacific's ratio reached 123.6%. We have not read Union Pacific's 2022 tariff terms, so this is a statement about the diesel price path, not about what was billed.

What the filings cannot show is why Union Pacific's ratio is above 100% while diesel is rising. The form has no breakdown by program, contract or commodity.

The filings do not say. BNSF paid $4.10 a gallon in Q3 2026 against Union Pacific's $4.21 (OPA calculation, line 1 / line 2), so a higher fuel price is not the reason. The difference is in surcharge revenue per dollar of fuel, and the form does not show how much of each railroad's traffic carries a surcharge or on what terms. We offer no explanation the filings cannot support.

A ratio above 100% is not proof of profit on any shipment. Two limits come from the form itself:

• Line 1 covers more than locomotive fuel. The form's footnote reads: “Include all other fuel used for railroad operations and maintenance, including motor vehicles and power equipment not charged to function 67 - Locomotive Fuels.”
• Line 4 is surcharge revenue billed on all traffic. Surcharges are billed only where a tariff or contract carries one, while fuel is burned on every train. The two lines do not cover the same shipments.

A surcharge is also only one part of a price. A shipper with a lower base rate and a higher surcharge may pay the same total as one with the reverse.

On Aug 17, 2026, Reuters published US railroad Union Pacific turned charges meant to cover fuel costs from Iran war into profit, by Lisa Baertlein and Tim McLaughlin. It reported that Union Pacific “collected $91.1 million more in fuel surcharges than it paid for fuel during the second quarter.”

Verdict: correct. Union Pacific's Q2 2026 filing shows fuel cost of 936,750 and surcharge revenue of 1,027,893 ($ thousands). The difference is 91,143, or $91.1 million. Reuters' figures for CSX and Norfolk Southern in that quarter ($8.4 million and $3.6 million) also match the filings (8,358 and 3,623).

Reuters also reported Union Pacific's response, in Reuters' wording: surcharge terms are negotiated within overall customer pricing, and the company's year-over-year percentage surcharge increase is in line with the industry. The Q3 2026 filing came after that article. It shows a larger gap for Union Pacific and larger gaps for CSX and Norfolk Southern too.

• The basis month. On the published program a surcharge on a December invoice reflects October's diesel price. December's rate is already fixed at 50.5%.
• The published table. Compare the percentage on an invoice with the table on Union Pacific's page for the same month.
• The terms. Union Pacific says surcharge terms are negotiated within overall customer pricing (as reported by Reuters, Aug 17, 2026). The trigger price, step size and lag are the terms that set the result.
• The monthly average as it forms. The basis is a calendar-month average of a price EIA reports weekly, so it can be tracked week by week on our diesel price page or pulled from the fuel surcharge API.

Did Union Pacific make $132 million in profit from fuel surcharges?

The filing shows surcharge revenue $131.8 million above total fuel cost for the quarter ending Sep 30, 2026. It does not measure profit, and it does not match surcharges to the shipments that paid them.

Where does the data come from?

From the STB's quarterly rail fuel surcharge reports. The form states that it is mandatory for Class I carriers and is to be filed within 30 days of the end of each quarter.

What is the Union Pacific fuel surcharge for December 2026?

50.5% on the carload rate-based standard program, per Union Pacific's published table (read Nov 13, 2026), based on the October 2026 diesel average of $6.252 a gallon.

Why is diesel this expensive?

See why diesel is so expensive in November 2026 and our weekly fuel surcharge page.