Hopefully the relevance of fuel prices to ecommerce are clear.
Back in April, e-commerce giant Amazon rolled out a temporary 3.5% fuel and logistics surcharge on some third-party sellers. United Parcel Service, FedEx and the United States Postal Service also moved to add fees on some of the packages they ship earlier in the war, citing rising costs for fuel overall.
Some additional sources, if you don’t trust the AP:
Just wait until home heating season begins. There will be new records.
If it’s not, I’d assert that paying closer attention to transportation-cost effects on one’s own bottom line, once all the bean-counting & number-crunching has produced an output, might well be in order.
So-called “Hidden Costs” abound - and they lurk, menancingly, in ways and means and places that far too-many of us seem content to overlook, if the available evidence of which I’m aware paints an accurate picture.
There’s more than a singular reason why diesel prices - historically lower than gasoline afore the 1980s, largely because it requires less crude-oil refinement processes & procedures - spiked above the gasoline-pump price way back then.
@ASV_Vites, thinking about your products, do they require refrigeration during transport?
From the link:
Items that need to stay refrigerated while they’re transported are often the first to see prices rise, according to David Ortega, a professor of food economics and policy at Michigan State University.
I’m wondering if you’re a bit of a canary in a coal mine. @VitRhea might have some insight, too?
The only “bright note” is that the “Venezuelan oil” can make for more abundant, and thereby cheaper cargo ship fuel.
One of my sons designs catalysts for oil cracking at refineries, a job with metrics so precise, if the yield claimed by his company is not achieved, the company is liable for the price difference to the refinery, talk about “unlimited liability”.
The “extra-heavy, sour crude” oil from Venezuela can be refined into heavy transportation fuels like diesel, industrial fuel oil, and asphalt, but even then, it requires specialized catalysts and other obscure equipment and incantations, as the stuff is just… crap. (No, I need to say this correctly, in the original Scottish - “CrrrrrrrrrrrrAP!” ya gotta roll the r for like 15 seconds, minimum).
One thing that can be made easily from this garbage oil is bunker fuel, burned by container ships. It is dirty enough that IAATO (the association of Antarctic Tour Operators) has agreed to ban its use on all ships going anywhere south of the 5 “Great Capes” South America, Falklands, South Africa, Tasmania/Australia, New Zealand - all the “capes”.
But making gasoline or US-grades of diesel? From that junk? Fuhgeddaboudit. Almost impossible to do profitably. The entire “deal” is a joke from the point of view of anyone who knows any petrochemical engineering.
Wow, thank you for that education! And the reality check. There’s no “easy” button for any of this, but personally I wasn’t aware of the difficulties with the Venezuelan crude, that it’s not a 1:1 replacement situation.
Yep, I remember hearing, when the invasion was first announced (with all oil execs in the room), more than one of them saying that they didn’t want any of it because of the low quality.
As for the current deal, I’ve read that everything should be ready to go by 2035 (at a cost in the billions). So not going to help any time soon.
I too remember that, but I’m constrained to point out the executive’s main sticking-point objection(s), re: yet again attempting the incorporating of Venezuelan crude into the U.S. pipeline-infrastructure, was mainly trepidation over further investment becoming subject to yet another “Nationalization” decree, descending from Caracas’ TPTB - inevitably, imponderably, & ineluctably resulting in more negative impacts to their bottom lines, as had happened not once (Mr. Chávez Frias) but twice (Mr. Maduro Moros).
There’s no question that switching to ‘dirty crude’ imposes costs - witness the Imperial Japanese Navy’s resort to less-refined fuel from Borneo when it fled from home waters, Truk/Chuuk, and Singapore Roads to Tawi-Tawi, in face of the shipping onslaught conducted by the various U.S. Submarine Force commands stationed in the Pacific during WWII, and the subsequent sinking’s suffered by the IJN’s naval & logistics shipping assets which, as most reputable historians since that time generally agree, probably are @ least partially attributable to that handicap alone - but I believe the most-pressing question, here, is the same it’s been since Humankind first tethered advancement to oil in the last few decades of the 19th Century:
“…just how far can consumers be pressed @ the pump?”
I think the more epistemic concern is that we can decimate entire states, unalive their population(s) and/or effectively take over their resources but we won’t bat an eye unless prices rise on the home front - then we wonder why.
Too much winning.
Nope.
Oddly enough, we did get Amazon Freight for a pallet going to MD from NY. That was $240, reasonable, but up about $50 from the good ol days (last 7 years)…
