How Higher Gas Prices Are Even Hurting Online Shoppers


A woman checks a box in the back of a van full of boxes.

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For the first time in years, drivers are taking to the road en masse. Many are back at the office and their daily commutes, and summer trips are starting to get underway. But all that driving is going to be a little more expensive than it was before the pandemic (or even last year).

In fact, the national average for a gallon of gasoline is now more than $ 5 according to AAA, and some states exceed that mark. It’s more than double that in 2019, and about $ 2 more than at this time last year.

That increase has caused many companies to rely on contracted drivers to add additional charges to help offset costs. You’ll see this whenever you request local delivery or purchase a shared ride, as Uber, Lyft, and even Instacart have added additional rates in the name of fighting higher gasoline prices. Many restaurants with staff drivers have also added their own fuel surcharges.

Rising fuel prices mean increased delivery costs

As if pump prices weren’t bad enough, however, the rising cost of fuel is affecting many of us at home as well. Higher fuel prices mean shipping costs are rising and retailers are passing those costs on to customers.

UPS fares, for example, have risen significantly this year. International charger fuel surcharges have risen 3 percentage points since March. It now stands at 18% for land shipments, the highest it has been in the last 90 days.

In response to rising costs, some online retailers have increased shipping prices as well as specific gas surcharges that apply to some orders. And as gasoline prices continue to rise, fuel-related delivery surcharges could become increasingly common for small retailers who simply can’t afford the cost of higher delivery rates.

However, it’s not just the little ones. Even retail giant Amazon, which has a major deal with USPS, not to mention its own fleet of delivery vehicles, has had to deal with higher shipping costs.

Someone pays, somewhere

Of course, you can’t assume you’re safe just because you don’t see a specific gas charge. When retailers pay more, so do customers. If the shipping price is not higher, the price of the item will probably be higher.

For example, Amazon recently reached out to sellers with a 5% “fuel and inflation” surcharge on its compliance service. This applies to all sellers who say “Completed by Amazon”. Since many of these items are shipped for free with Prime, the only way a seller can offset the cost is by increasing the price of the item itself.

So even though your Prime deliveries are still free, the purchase price has probably gone up. And it is likely that the same is true in major retailers in all areas. Any site that maintains its free shipping policies will make up the difference in some placeand raising prices is usually the easiest solution.

It may make more sense to pick up your purchases

Even if you don’t have a lot of resources for higher product prices, in addition to being a more diligent comparison buyer, raising delivery rates may have a solution: collect orders.

Many of the major retailers offer the option to place orders online and then collect the purchase in the store. Depending on the delivery rate (and your vehicle’s gas mileage or public transportation costs), it may make more sense to go through the store to pick up your order. This applies to retail shopping as well as restaurant and grocery orders.

And, if you still don’t have a good gas rewards credit card, now may be the time to add one to your wallet. Gaining an extra 3% to 5% on gasoline won’t get you back to 2019 prices, but it can certainly help you get your gasoline budget going a little further.

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We strongly believe in the Golden Rule, so editorial opinions are ours only and have not been previously reviewed, approved or endorsed by the included advertisers. Ascent does not cover all market offerings. The editorial content of The Ascent is separate from the editorial content of The Motley Fool and is created by a different team of analysts. John Mackey, CEO of Whole Foods Market, a subsidiary of Amazon, is a board member of The Motley Fool. Brittney Myers has no position in any of the above actions. The Motley Fool has positions on Amazon and recommends. The Motley Fool recommends Uber Technologies. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.



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