Americans are feeling the force of outrageous gasoline prices in a number of places.
The Wall Street Jounal is reporting that “a 36 percent rise in retail gas prices since early December is causing delivery companies, cruise lines, taxis, electric utilities, garbage collectors, landscapers, pizza chains and numerous other businesses nationwide to either tack on extra fees to the basic consumer price or to increase existing fuel surcharges.”
United Parcel Service Inc. and FedEx Corp. this week boosted add-on fees for packages delivered by ground to 3.75 percent of the shipping rate from the previous 3.5 percent
The U.S. Postal Service, which recently raised the price of a first-class stamp,proposed a three-cent increase in the price of a 39-cent stamp, partly because of rising fuel costs. The post office doesn’t use fuel surcharges.
WSJ warns that “other businesses that haven’t yet passed along escalating fuel costs to customers say they will have no choice if the price of oil keeps rising amid worries over increasing tension between Iran and the U.S.”
Two national companies that serve the St. Louis area have upped their fees.
Schwan’s Home Service Inc., a Marshall, Minn., company specializing in “restaurant-quality frozen foods,” has imposed a $1 fuel fee on most home-delivery orders. About 90 percent of pizza chain Papa John’s International Inc.’s 2,600 locations in the U.S. now charge a delivery fee, typically $1.25 to $2
Swift Transportation Co. and J.B. Hunt Transport Services Inc., two large trucking companies, collected a combined $189 million in fuel surcharges in the first quarter, up 53 percent from a year earlier. Railroad operators Union Pacific Corp. and Burlington Northern Santa Fe Corp. had $2.12 billion in surcharge revenue last year, compared with $680 million in 2004, according to securities filings
Rising travel fees
Some of the fuel surcharges that summer travelers will face:
American Airlines and Delta Air Lines increased add-on fees on many international flights by $10 to $19.
Maverick Helicopter Tours added a $15 per person surcharge for 1 1/2- hour ride from Las Vegas.
Windjammer Barefoot Cruises added a $25 per passenger fee for Caribbean trips.
More bad news
U.S. Energy Secretary Samuel Bodman said last week that prices paid at the pump for gasoline could stay high for two or three years.
“Suppliers have lost control of the market,” Bodman told NBC, when asked what the reason for the latest spike in U.S. gas prices. “Therefore demand exceeds supply.”
A second major factor for higher gasoline prices is the seasonal shift from winter to summer gasoline grades, which has resulted in some “dislocations” that have caused some prices spikes, he said. “All of that is adding to the situation we now have. I expect the latter to settle down over a month or two, but clearly, we’re going to have a number of years, 2 or 3 years, before suppliers are in a position to meet demands of those who are consuming this product.”