A cut in the fuel surcharge comes into force at the Steam Packet from today.
It's falling from £5 per passenger each way to £3.50.
For freight, the surcharge will reduce by 53p, from the current rate of £5 per metre, to £4.47.
The company says the revised rates will apply to new bookings from June 1.
The fuel surcharge is based on a formula agreed with the Department of Transport.
It reflects costs both before and after the review date, and is based 50 per cent on average marine fuel costs in the three months prior to review and 50 per cent on forecast costs for the three months ahead.
Future reviews under the new agreement will take place every three months.
Isle of Man Steam Packet Company Chief Executive Mark Woodward, said: "The new agreement is good news for both the Steam Packet Company and the Isle of Man and has resulted in a substantial fall in the surcharge for passengers and a further reductiom in the rate for freight, which fell by 37% at the previous review in March.
"The new agreement reflects current market rates and forecasts, as per the Select Committee preference, and the three-monthly reviews will reflect market changes more promptly than the old agreement."