A fuel surcharge is usually calculated from a published diesel price index, a peg (the price at which the surcharge is zero), and a formula that converts the difference into cents per mile or a percentage of linehaul.
On contract freight the surcharge mechanism is defined in the agreement and updates weekly. On spot freight it is often folded into an all-in rate, which is why comparing spot loads on the all-in number can mislead — a higher surcharge means a lower true linehaul.
The surcharge is meant to be cost recovery, not margin. When diesel is stable near the peg, it contributes little; when diesel spikes, it protects the carrier from eating the increase on freight booked earlier.
Example
A contract sets a peg of $3.00 per gallon and adds $0.01 per mile of surcharge for every $0.05 diesel is above the peg, based on a national index. With diesel at $3.85, the index is $0.85 over the peg, so the surcharge is $0.17 per mile on top of the linehaul rate.
Why it matters
Two loads at the same all-in rate are not equal if their fuel surcharges differ. Separating linehaul from surcharge is how a dispatcher compares what a lane actually pays.