NEWBURYPORT — As gas prices rise, the price of virtually everything, from flowers to fertilizer, is getting more expensive by the day.
And yesterday was a bad day.
The price of a barrel of oil reached a record $107 per barrel yesterday, meaning as soon as today the average cost of a gallon of regular unleaded nationally could surpass the record of $3.23 per gallon set shortly after Hurricane Katrina in 2005.
In the Bay State yesterday, the average price per gallon was $3.09, up 9 cents in two weeks and set to go even higher, though it's the seventh-lowest of any state across the country, according to a AAA survey.
While most reports say the price is likely to peak below $4 per gallon this spring, more and more of the experts aren't ruling out hitting $4.
Trilby Lundberg, publisher of the Lundberg Survey used nationwide by business analysts, warned motorists not to expect the prices to fall anytime soon.
"We should be ready to absorb even higher prices, and quickly," Lundberg said, citing last week's decision by the Organization of Petroleum Exporting Countries not to increase oil production, the primary driver of current increases.
Locally, businesses that rely on driving and byproducts of oil are feeling the pinch and already are devising plans if costs continue to climb.
"We are feeling it quite a bit; it's going to affect everyone in every aspect," said Denise Weir, owner of Denise's Flower Shop on Pleasant Street. "It's not only the cost of gas for the person driving to deliver the flowers, but we are also consuming the cost of the wholesale deliveries we get of flowers, glass and other heavy packages."
Weir foresees raising her delivery prices in order to stay in business. She now charges a $6 delivery fee for local orders but said she will have to raise the price 50 cents soon.
"I'm trying not to raise prices, but I probably will in time if this keeps up," Weir said. "You don't want to turn down business, but we have to make our bottom line, too. So we have no choice; it's right across the board."
At Iron Moon Farm in Newbury, owner Colin Smith said he doesn't know what he will do if the prices reach $4 per gallon, which analysts say will be a possibility by summer.
"We're all caught in something we can't get out of," Smith said. "It's killing us, and it's going to affect a lot of things."
Fertilizer, a byproduct of oil, has jumped from $500 a ton to more than $800 in just the past year. Smith said the average farmer needs 300 pounds for 1 acre, so when fuel prices soar, the farmer almost always gets hurt.
"It's everything: fertilizer, seeds, fuel, off-road fuel for the tractors, feeding the animals. There is nothing you can ask on a farm that doesn't have to do with fuel," Smith said.
Smith is researching how to use solar, hydro, or wind energy to power the farm but said the government does not always make it easy on farmers using alternative energy.
City Auditor Bill Squillace said that though they don't have a crystal ball to predict fuel costs by the end of the fiscal year, Mayor John Moak has already transferred additional money into the budget to soften the blow.
"We put $20,000 into the schools to handle the increase in electric and energy costs," Squillace said. "We haven't overspent yet, but we will need to reassess at the end of the year. If prices go up 10 percent, costs will increase."
From powering streetlights to fueling Department of Public Works trucks, police cars, and water and sewer vehicles, everything is affected when prices soar, Squillace noted.
"It's hard to say because next month it could be lower, but they do think it's on the up and up," he said.
Salter Transportation, which provides school bus service for Newburyport and the surrounding communities, tries to factor the cost of fuel in when negotiating contracts with schools, but the upward trend will mean the company will have to absorb the difference.
"We use diesel, which didn't used to be that expensive, but now it is," general manager Steve Gadd said. "If they keep going up, it will be bad. I will have to get on my hands and knees and beg."
Average Gas Prices Nationally
Regular Mid Premium Diesel
Current $3.22 $3.42 $3.54 $3.82
Month Ago $2.96 $3.14 $3.25 $3.36
Year Ago $2.53 $2.69 $2.79 $2.72
Source: AAA Fuel Survey
Lowest Price
Cheyenne, Wyo. $2.95 for a gallon of regular
Highest Price
San Francisco $3.58 for a gallon of regular
