First, explain to the buyer that you have received the item back from USPS and issued a full refund, and you're going to send a transaction cancellation request. This has no impact on the buyer at all. It simply allows eBay to refund your final value fees. Then send the transaction cancellation request. If you don't explain first, the buyer won't know what the request is and will decline it thinking it's some sort of scam.
You cannot cancel it. It is not your business so you have no control over it. It is up to eBay and it is at their discretion. Generally, when an item is disputed for some reason and refunded, you will be refunded the final value fee. However, the problem may lie in that you failed to communicate with the buyer and failed to attempt delivery elsewhere. Perhaps, that might be the problem. You sold it but the item was not disputed. Without a dispute case opened, no refund is offered. However, only eBay can answer your question for sure. If you will not ask them why they refuse to refund you, then you will not get an answer and if they decide there will be no refund, then there will be no refund.
I sold an item to a guy 3 weeks ago and he never got it. The post office attempted to redeliver it several times in a two week span, but the item came back to me. But on the USPS website, it's listed as delivered. I told the guy, refunded his money through paypal, but eBay is still charging me a final value fee of 12.90, because the item is listed as delivered. What can I do to cancel that fee?