The price of a barrel of crude oil stood briefly Monday at a record high, even adjusted for inflation. Oil prices rose to nearly $104 a barrel in futures trading before ending the day slightly lower.
That peak put the price above the inflation-adjusted record set in April of 1980, and it means more pain at the pump in coming weeks and months. But that might not be the only way we feel the spiraling cost of petroleum.
Name a product or a service, you'll find the rising price of oil built into its cost to us and you'll find a business constantly trying to adjust. Some impacts are more obvious than others. Cab drivers buy their own gas. Each hike is an immediate bite out of their income. In fact any business that puts a vehicle into the streets finds the cost of business rising with the cost of oil.
Take your neighborhood florist. Like the Pizza man, deliveries are a big part of his business. Getting that bouquet to your sweetheart, wife or mother means one by one deliveries all over town. Just like the rest of us, the florist seems to be paying more each time he gasses up. Now he's staring at the promise of future increases, perhaps $4 dollars a gallon sometime this summer.
Mike Fiannaca of Sparks Florist says his business can react either by raising prices or making cuts. Mainly they just try to keep prices stable. That's difficult in today's economic climate. Fiannaca says technology has helped. His drivers now leave with GPS navigation systems on delivery routes designed by the computer for maximum efficiency.
But delivery costs are only the most obvious impact of gas prices on this business and in many ways the easiest for him to address. He deals in a perishable product; an inventory produced elsewhere, one that turns over constantly. Some of the flowers that go into bouquets are grown in California. That's comparatively next door compared with other flowers. Mums, for instance, were grown in Colombia, flown to Miami and then trucked clear across the country. A long trip with surcharges built in along the way.
It's a big part of his cost and yours. As much as 35% of the cost of the bouquet you buy is transportation. He can't do much about the long range shipping charges, but his company is now making its own runs to growers in California. In fact, he says doing his own trucking helped him hold the line on the prices of roses this Valentine's Day.