Surging gas prices have Ottawa businesses prepping their own price hikes

Record-high gas prices sparked by Russia's invasion of Ukraine have forced some Ottawa businesses to contemplate raising their prices to stay out of the red.

The invasion has thrown markets around the world into chaos, including the energy market. Russia is one of the largest producers of oil and gas in the world, and the high demand for oil combined with a shortage of supply has been pushing oil prices — and consequently gas prices — up for weeks.

Taxi drivers are especially feeling the pain at the pump since they pay for their own gas, said Unifor Local 1688 president Ali Enad, whose union represents Ottawa drivers.

"It does affect us extremely [strongly] and we are actually struggling to make ends meet for our kids and families," said Enad, who's also a taxi driver himself.

Even before the spike in fuel prices, both the union and Coventry Connections — which operates a number of taxi fleets — applied to the City of Ottawa in late January to increase rates, as they're facing more expensive operating costs overall. They are looking for a 10 to 20 per cent bump.

Enad said hundreds of drivers have left the business in the last couple of years, and the number of drivers his union represents are down to 700 from 1,300 in 2019.

Delivery costs going up

Eunwoo McPhee, owner of Terra Plants and Flowers in Manotick, says if gas prices stay high, she'll be forced to raise prices for the deliveries her business makes across Ottawa.

"[The] last two months, it was really tough for us because we don't have many walk-in customers to the store. But we [still have] delivery," said McPhee.

But the cost of making deliveries has now risen by 20 to 30 per cent, said McPhee.

Fadi Azba, the owner of local online food delivery platform iDelivery Canada and courier service Gopher It Deliveries, is also hoping gas prices go down.

"If it doesn't, definitely we have to increase our prices. And that will also ultimately affect consumers, because by us increasing the price of delivering the goods, our customers will have to increase their price, their shipping price," Azba said.

"And at the end of the day, unfortunately, the consumer is going to end up paying more money."

Higher gas prices are taking about a 25 per cent cut out of his bottom line, Azba said, and his drivers are apprehensive about making longer deliveries.

"It's definitely taking a toll on the business," he said.

Moving is costing more

For Alex Madore, a sales manager with for Parkview Moving Co., surging energy prices have "definitely turned into a major headache."

Moving from Ottawa to Toronto currently costs about $800 in fuel, compared to one year ago when it was just $450, said Madore.

The company has said it's planning to raise its prices, too.

"Not only does it affect the cost of running the trucks, but also the cost of all the equipment that we need — the packing supplies, boxes," said Madore.

"A lot of people book with us months and months in advance. We can't go back and charge them more all of a sudden. We're losing a bit of money in that sense."