FERC today finalized its five-year review of the oil pipeline rate index used to determine annual changes to oil pipeline rate ceilings. Every five years the Commission reviews the index level to ensure it adequately reflects changes to industry costs and to ensure oil pipeline indexed rates remain just and reasonable.

The Commission's final rule establishes an index level of Producer Price Index for Finished Goods minus 0.55% (PPI-FG - 0.55%) for the five-year period commencing July 1, 2026. Under indexing, oil pipelines may charge transportation rates up to their applicable rate ceilings.

"Today's final rule does exactly what it should - calibrate the index to reflect real cost changes in the industry. By setting an accurate index level, we ensure that pipelines receive fair returns for providing a critical national service, while also protecting shippers from excessive rates.

"This order should not raise gas prices at the pump, or the price of airfare for ordinary Americans. The reality is that pipeline transportation costs represent a tiny fraction of the total price of fuel from an end-use consumer's perspective. Without proper incentives for pipelines, our country risks losing the pipeline network needed to deliver abundant and affordable gasoline and jet fuel to customers." - Chairman Laura V. Swett

Today's final rule adjusts the cost data used to derive the index level to account for the 2020 change in Commission policy for determining the allowed rate of return on equity for oil pipelines. The Commission adheres to its proposals, in its November 20, 2025, Notice of Proposed Rulemaking, to exclude from the data set pipelines' resubmitted cost data for 2019 and trim the data set to the middle 80% of cost changes.

The final rule is effective on the later of 60 days after publication in the Federal Register or 60 days after transmission of the Final Rule to Congress and the Comptroller General.