Gas prices in the United States are expected to continue to increase as a result of Russia's invasion of Ukraine. President Biden warns Americans that the escalation of the conflict could mean trouble for the US economy and fuel inflation. President Biden has also hinted toward tapping into petroleum reserves if necessary to help ease the pain that many Americans are feeling at the gas pump.
It will be interesting to see how Russia responds to the sanctions that many NATO countries have begun implementing. This could significantly increase oil prices as tensions begin to rise between Russia and NATO leaders. Russia is the third-largest producer of oil and the second-largest producer of natural gas, so it is unlikely for Russia to cut exports as their economy heavily relies on revenue from oil and natural gas exports.
Over the past year, we have seen gas prices continue to rise mostly due to the increase in demand as COVID fears ease. Gas prices have played a critical role in rising prices in the United States, accounting for about a quarter of the 6.1% rise in inflation. The rise in prices and increased tensions have pushed many world leaders to reduce reliance on oil natural gas. Overall we can expect an increase in prices at the pump due to inflation and the war in Ukraine, however, I believe the Biden Administration will do the best they can to keep prices stable even if that means tapping into reserves.
https://www.washingtonpost.com/us-policy/2022/02/24/oil-price-russia-ukraine/
I think it will be interesting to see how the economy, ours and others, is effected during wartime. It is unfortunate that it will probably lead to an increase in gas prices, but it is not surprising since Russia is a big supplier of oil.
ReplyDeleteI am not surprised that gas prices are predicted to rise because of how Russia is a big oil supplier for some countries. I also think it will be interesting to see the economic effects this will have.
ReplyDeleteRussia’s invasion of Ukraine will probably result in higher gas prices, and higher inflation. Americans were already complaining about high gas prices prior to this invasion, so this will definitely cause a lot of rile. If the conflict further escalates, Russia might decrease their oil exports which will have a negative impact on the US economy.
ReplyDeleteI know the US was thinking about implementing a tax on gas to decrease prices even if it isn't for long, so I wonder if Russia has a similar idea. Leaning towards probably not especially with the war going on with Ukraine, that wouldn't be their first thought.
ReplyDeleteSpeaking that gas prices were already rising, there is no question that this news and conflict will keep them going up. I'm interested to see the prices on gas if the energy juggernaut Russia does claim Ukraine and their gasoline pipeline.
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