Fuel crisis deepens, touches all forms of energy

| 6/26/2008

As America’s fuel crisis deepens, more and more trucking companies are reacting by lowering speeds and raising prices.

The latest is Dallas-based Frozen Food Express, which had already lowered the speed limiters on its trucks from 65 mph to 62 mph. And now, according to a press release, it will start charging customers for the diesel it burns in its refrigerator units.

A company official was quoted as saying: “We have reached the point where it is not financially feasible to continue to bear the brunt of this brutal fuel environment without some relief.”

Meanwhile, The Chicago Tribune reported that Dow Chemical – which makes everything from Lorsban pesticide to Styrofoam and Saran Wrap – has announced that it is raising prices for the second time in a month because of fuel costs. The two increases will add as much as 45 percent to the cost of Dow products.

The New York Times reported that Dow also said it would impose freight surcharges of $300 for each truck shipment.

Economist Gerald Miller, Ph.D., at Rockhurst University in Kansas City, MO, said the ripple effects of the price of oil aren’t causing only “pain at the pump.” He cited natural gas bills this winter – which are expected to rise by 35 percent or more.

“It’s showing up in terms of all kinds of energy, (such as) home heating oil,” Miller said of the price of oil. “It’s showing up in terms of people’s vacation plans, and therefore spreading out to hotels, and theme parks, and vacation-related entertainment industries.”

Miller also pointed out that the effects are reflected in “poorer car sales, truck sales, SUV sales, anything that is not particularly fuel-efficient and therefore has become an additional burden for our domestic automakers.”

“It’s (also) showing up in orders being either canceled or deferred for major airline manufacturers such as Boeing,” he said.

Energy costs are already shrinking state and federal highway budgets because people are driving less and therefore paying less in fuel taxes.

– By Staff Writer Reed Black