Weyburn service stations posted yet another gas increase to 74.9 cents per litre last week. Consumers are feeling the squeeze and the transportation industry is reeling as one of its major input costs continue to rise more than it has in the last decade.

The stress of the higher prices will have further effects on the economy, but for now, trucking and transport companies are among those bearing much of the cost.

"There has definitely been an increase in the cost of operations," said Glen McLeod of Grainbelt Transport, whose company specializes in grain hauling. "It is very difficult to pass this increase in price to customers, especially since some accounts have been established on a yearly basis and cannot be changed."

"When the prices are this high, it eventually passes to the consumers. Even if prices stabilize now, it will probably takes six to eight months before consumers feel the full impact reflected in all the products petroleum is used in," said McLeod.

Just for an example, McLeod said that the cost of tires would likely increase. After the impact of the temporary increase in petroleum prices has passed, it is unlikely that the price of the tires would go back to what it was before the shift in input cost. Thus, an inflation of the true value of the product is the end result.

"There should have been something done the last time a so-called fuel shortage drove prices up," he said. "I think we should have developed an alternative fuel supply. We should have put more emphasis on this so we're not hostage to the petroleum industries. But last time, as soon as the prices stabilized, people forgot to do something about it."

The Canadian Petroleum Products Institute (CPPI) broke down the pump price components as of March 14, when the price of gas was 72.9 cents per litre.

According to its statistics, 29.2 cents of the cost per litre is the price of crude oil. Taxes are 29.8 cents of the pump price and refining cost 7.4 cents per litre, while marketing margins are another 6.5 cents per litre.

Overall, in Prairie markets, the price has risen an average of 4.2 cents per litre since February 22 and the four-week average pump price is up over 19 cents per litre from the four-week average of the same period last year.

As of March 14, marketer margins ranged from 5.1 cents per litre in Calgary to 6.5 cents per litre in Regina. This compares to a 52-week average of 5.9 cents per litre and 7.0 cents per litre, respectively.

No one expects a decrease in gas prices anytime soon.

"Our expenses have definitely gone up with the higher fuel prices," said Dennis Mainil, manager of Jerry Mainil Ltd, which provides a number of pipeline and road services. "We're waiting on what the OPEC meeting will say, to see if they can open the gates. In that event we might see a drop in price, but while the price can go up in a hurry, it doesn't go down as fast."

"We have to keep our rates the same, we have to absorb the cost and work on a smaller margin," he said. "This is a very competitive business and there is not a lot of room for increase. If this keeps up, we'll eventually have to do something."

Trevor Laird of Demsey Laird Trucking Ltd. of Midale, which does oilfield work, plans to wait out the high fuel prices, finding some irony in the fact that while oil prices are up, the transportation industry can't take full advantage of the boom.

"Prices have definitely had an impact on what we're doing," said Laird. "There is too much equipment around for the amount of work, so rates cannot be raised. I honestly think that fuel prices will come down in a little bit and I'm going to hold onto that thought for a few months. It should balance out, but if it doesn't, the bottom line might not be in our favour."

Retailers are also feeling the pressure. Ronelda Fortner of 7-Eleven Esso said that the latest increase is a direct result of an increase in cost to retailers. She said gas sales are falling due to the price and that it is likely consumers are holding back on buying whenever possible, or seeking slightly cheaper locales closer to the border.

Betty Bavle, manager of the Petro Canada on Government Road, said customers know about the high cost of oil and understand that prices increase when service stations must buy their products at sky-high prices. While she said gas sales are down, she believes there is much more at work than price alone.

"The biggest thing is the farm economy and the poor price of gas is not helping," she said. "Until the farming situation picks up, it's not going to pick up in the city. It's always slower in the spring, but when the farmers don't have anything, it affects everything else."

Vic Messer of Suds City Mini Mart said his company is close to holding its own, although prices have probably affected business somewhat. He does not attribute everything to price, citing normal fluctuations of the service industry as a factor.

"Just when we think the prices are really affecting it [business], we get so busy we don't know which way to turn," said Messer. "That's the normal feast and famine aspect of business. People are probably more aware of prices, but they still have to drive."

Although crude prices are declining somewhat to $27 U.S. per barrel, there doesn't appear to be any relief in sight. According to CPPI, a period of tight supply and volatile prices seems likely for the next few months.