Oil Prices And The Bottom Line
CBS
Transcript
now to the CBS News money watch the energy Department said today that with prices at record highs in the first half of this year us demand for oil plunged an average of 800,000 barrels a day the biggest decline in more than a quarter Century there's good news about gas the department is lowering its price prediction for the summer by 33 cents it now expects gas to average 388 a gallon dropping 7 cents more in the fall but there is no relief from high food prices the floods in the midwest that ruined so many crops are long gone and farmers are now expecting bumper crops of corn and soybeans but the agriculture Department today predicted a 5% increase in food prices this year 4 and a half% next year because of the high cost of energy used in processing packaging and transportation Nancy ctis has more there's a lot that goes into shipping a box of Harbor House crabs and these days a lot more money goes into it too as owner Kurt Engle learned when his Federal Express rates shot up 35 bucks a bushel the first thing I'm doing I'm calling my FedEx rep and saying what's going on since April FedEx has raised its fuel surcharge from 18.5% to today's 34.5% as it copes with a 54% hike in the cost of fueling its trucks and jets UPS same rate hikes now it's trying out new GPS devices that allow cargo planes to make more direct Landings now I'm just going to range in but that saves just $200 a flight for the shipping and trucking Industries which run on fuel there are few ways around high oil prices a container coming from China to La the price of that container has gone up by close to 50% in The Last 5 Years diesel prices have driven an estimated 45,000 big rigs out of the business just since last year trucking companies that used to cap speeds at 68 mph are slowing down to 60 to save on fuel Walmart wants to give the nation's first hybrid big rigs a go from a driver's Viewpoint there's there's really no difference they push on the throttle it goes they step on the brake it actually Powers it back and charges the batteries today's higher shipping costs mean higher prices for everything Kurt Engles had to raise his and says sales volume is down about about 20% is it tough for you to decide how much of that increased cost you're going to pass along to the customer well we obviously have to pass on some of that cost because we can't eat that cost thousands of businesses just like his watch out watch out watch out watch out out are feeling the same pinch Nancy gordis CBS News Harrisburg p