Gas prices don’t just hurt at the pump

Gas prices have sent an economic shockwave through the country, with pump prices soaring well above $3 a gallon.

While the price affects everyone hard at the pump, consumers are taking multiple hits as fuel prices bring price jumps to many sectors of the economy.

“Areas like Southern California are especially hard hit because the region relies so heavily on driving as a method to transport goods,” said Roger Stein, a Newport Beach financial analyst and economist. “Every sector of the economy is affected by the price of gas.”

Some consumer goods could see a price boost, but most retailers and restaurants try to absorb the cost for a while, Stein said.

“If it appears to be a short-term rise, most people will avoid raising prices,” he said. “Business people are keen that consumers are already tight on cash because of price increases.”

Just how long gas prices will continue to rise is anyone’s guess. A news release from the Automobile Club of Southern California blamed the increases on a highly speculative futures market and international concerns about Iran’s nuclear enrichment program. The club estimated the high prices could taper off in a few weeks, but it remains unclear if it will ever drop back down to pre-April levels.

“Something has got to give pretty soon,” said Parker Anders, who runs a courier service in Costa Mesa. Anders said he’s seen his operation costs increase by 20% and is worried about how much more his bottom line can sustain.

“Gasoline is my major business expense, and right now it’s killing me,” he said.

Anders is considering raising prices, but he worries his small list of clients will simply cut him off if he charges more.

Omar Mudasa runs a small convenience store near Corona del Mar and said he’s having a hard time keeping his shelves stocked.

“Every time the price goes up, I get less deliveries [from distributors],” he said. Companies that provide him with beer, snacks and cigarettes are stopping by less frequently in an effort to cut down on mileage. While his costs remain stable, he’s having a hard time keeping some of his most popular items on the shelves.

Reginald Frankenbaugh said he definitely plans to increase prices for his leafleting service, which provides door-to-door advertising throughout Orange County.

“My rates have already gone up,” he said. “That’s just the cost of doing business. We all have to make a living.”