By Daniel Braha
The issue of high gas prices has become more apparent than ever for the American people. Consumers have already seen the impact of the COVID-19 pandemic on gas prices, but the Russian invasion of Ukraine has worsened the situation in recent weeks. The gas prices have now escalated so much so that U.S. citizens are having a hard time keeping up with the exorbitant fares. Americans have never seen gasoline prices this high, nor have they seen the pace of increases so exponentially. At this point, it is difficult to know whether to attribute these crazy prices to the pandemic, the U.S. political landscape, or the war for these outrageous costs.
During the pandemic’s peak in 2020-2021, American citizens began to see higher prices at the pump. Prices jumped during that period largely because the Organization of the Petroleum Exporting Countries said it would not boost oil production due to an “imbalance in oil supply and demand.”
With regards to the ongoing Russian invasion of Ukraine, President Joe Biden has recently been a subject of criticism. Specifically, the President has made many sanctions that targeted, or rather banned, Russian oil imports to the United States. President Biden has stood by the position of the sanction on Russia and conceded that the American people would have to pay more for gas. He also made reference to the proposition that defending freedom had to come at a cost and as such the U.S. citizens had to bear the cost.
To put this into perspective: regular-grade gas prices have hit up to $4.173 this past week–a 55.4 cent increase from a week ago–according to the American Automobile Association. This price increase is in addition to the 40% year-over-year increase in gas prices as of the end of January. It is worth noting that while gas prices continue to climb, the aforementioned figures do not account for inflation, which has seen record-high rates in the past week as well.
It is clear that the White House is conflicted between the need to address the high price of gas and its agenda with the war in Eastern Europe. In the short term, this is leading the White House to approach governments it had previously shunned, such as Venezuela, or had friction with, like Saudi Arabia, to secure additional energy supplies. Government officials are adamant that their policies are not impeding the domestic production of oil and gas and assert that transitioning to clean energy is the only way to truly become energy independent in the long run.
Increasing gas prices havewho have limited options in ways to earn money. Evidently, the tension may be on the rise since Russia’s assault on Ukraine is predicted to escalate in the subsequent weeks, which may continue to send tremors through the world economy by ratcheting up energy prices. Considering that Russia is one of the biggest oil and gas producers in the world, any disruptions to their exporting system may have a major impact on prices. In addition to the current gas price crisis, the COVID-19 pandemic has already left the global economy with jittery financial markets, which the rising inflation rates do not remedy. The aftershocks from the invasion could easily worsen the current situation, causing gas prices in the U.S. to remain high and continue to rise to record-breaking levels.
Photo Credit: Daniel Braha