You might not be paying attention to the Iran war, but your wallet is. This week, major American companies started doing what they always do when costs rise: passing them straight to you.
Amazon just slapped sellers with a 3.5% "fuel surcharge." United Airlines and JetBlue both raised baggage fees. Moving companies are tacking on diesel surcharges. And if you think this is temporary, I have bad news: these fees are never coming back down.
Here's how the war tax works: Diesel and jet fuel prices have spiked since the conflict started. For most businesses, fuel is a variable cost that used to run 3-5% of revenue. Now? It's doubled to 6-10% for logistics companies, according to Nick Friedman, co-founder of College Hunks Hauling Junk and Moving.
Friedman told CNBC his company is in a bind. "We are in a bit of a Catch-22. Our fear would be if we start raising prices it will hurt our customers." But here's the thing: bigger companies don't have that fear. They're just raising prices.
Amazon's fuel surcharge is a perfect example. They're calling it "meaningfully lower" than other carriers, which is corporate speak for "we're charging you more but pretending it's a deal." And because Amazon controls so much of e-commerce, sellers have no choice but to eat the cost or pass it to consumers. Guess which one they're choosing.
JetBlue defended their baggage fee hike by saying they need to "manage those costs while keeping base fares competitive." Translation: we're hiding the price increase in fees instead of the ticket price, because that's how we trick the fare comparison algorithms.
Why these fees are permanent: Companies love using external shocks - wars, pandemics, hurricanes - as cover to raise prices. But here's the dirty secret: even when costs normalize, the fees don't disappear. Remember all those from 2020? Most of them are still on your bill, just renamed.
