Returning business

Every day brings a new story about the impact rising gas prices are having in a myriad of ways from the local to the national and international level.

The budgets of fire and ambulance services are being strained by the skyrocketing cost of fuel. Gasoline now exceeds $4 a gallon while more expensive diesel fuel is above $5 a gallon. In two separate stories Monday, USA Today reported "Escalating gas prices weighing down Postal Service" and "Carnival rides grounded as fuel prices skyrocket."

Commuters are turning to alternatives such as more carpooling. Many are parking their cars to rely on mass transit, with ridership hitting new highs in many metropolitan regions.

The Erie Canal, which declined in commercial use years ago as business shifted to freight trucks and trains, is the preferred mode of transportation for one shipper seeking to hold freight costs down. A barge carrying a 450-ton turbine ultimately headed for western Canada, made its way last week through the canal system, which proved to be more cost-effective, the Syracuse Post-Standard reported. A single gallon of fuel can haul a ton of freight 514 miles on a barge, but only 59 miles in a tractor-trailer.

But oil prices are also driving up the costs of shipping on the international seas and serving to bring outsourced business and jobs back to America. The Wall Street Journal recently reported on several manufacturers shifting work away from their foreign plants, especially in China, and moving it closer to home in domestic facilities, if they still have them available. Some firms are holding off or cutting back their plans to relocate to China or other countries.

Shipping costs for a 40-foot container from China have tripled since 2000 and could double again if oil hits $200 a barrel. That cost is the same as a 9 percent tariff on the imported goods, compared to 3 percent when oil sold at $20 a barrel in 2000.

There are limits to the move home. Some long-closed, energy-inefficient manufacturing plants may not be opened readily or cost-effectively. Also, the costs of transporting raw materials and supplies at home may be a deterrent. The shift is not expected to restore the thousands of jobs that have been lost to outsourcing, but the high cost of fuel could slow the trend of the past two or three decades.