Cargo Business Newswire

Wednesday, July 8, 2015

Union Pacific levies surcharge on older crude railcars

Union Pacific Corp. told customers that move crude in older railcars, it will levy a $1,200 per-car surcharge on oil, becoming at least the second U.S. railroad to raise costs in the midst of widespread safety concerns.

In a revised tariff effective Aug. 1, Reuters reports the No. 1 U.S. railroad posted rates that will charge shippers more if they use so-called DOT-111 railcars, which are not as strong as the cars built to a higher standard the industry adopted in October 2011.

For DOT-111s carrying an average of 700 barrels of crude per car, a $1,200 surcharge would add an additional cost of $1.71 per barrel shipped.

Union Pacific said it changed its tariff in response to stronger U.S. rules for handling flammable liquids that were recently announced after a string of fiery crashes.

For more of the Reuters story: www.reuters.com