Have you noticed how gas prices have skyrocketed? According to CNN Business, the national average gas price has flown to $4 per gallon as of this March. Gas was already getting more expensive but now it has increased more. Why is this happening? The major reason for the hefty price is the response of the U.S to the Russian invasion of Ukraine. Here is why.
Money talks. The United States and other NATO countries composed of the likes of France, Germany, Britain, historically neutral countries like Switzerland, and other countries from the European Union are by employing economic sanctions on Russia
For example, the Biden Administration along with Germany imposed sanctions on the business behind Russia’s 800 mile long natural gas pipeline named the Norm Stream 2. Additionally, the U.S has cut off Russia’s top two banks, Sberbank and VTB Bank, and several other large companies from the western market and the U.S and the rest of NATO has thrown Russia out of the SWIFT financial messaging system. This exclusion will make Russia unable to make international transactions in trade. The biggest economic sanction that affects us the most is that President Biden put a halt to the importation of Russian oil, coal, and natural gas in the U.S.
Due to a highly globalized world, whatever happens in another country has a ripple effect on the whole globe. According to the U.S Energy Information Administration, Russia is the European Union’s main market for its oil and natural gas exports. In 2020, Russia was the third-largest producer of oil after the United States and Saudi Arabia. Cutting off Russia leaves an empty gap that creates a higher demand for these needed exports in Europe and the U.S. Furthermore, the U.S was already fighting off inflation with gas prices rising before the Ukrainian Invasion. That’s why gas prices reached a national average of $3.44 per gallon in February of 2022 according to AAA.
The economic sanctions of Russian oil affects Americans the most because a major difference between the three biggest oil exporters of the U.S, Russia, and Saudi Arabia is that the U.S uses far more oil. According to the 2021 BP Statistical Review of World Energy, the U.S uses 17.2 million barrels of oil per day compared to 3.2 million barrels of oil per day in Russia and 3.5 million barrels of oil per day in Saudi Arabia. The unique high demand for oil in the U.S is highly vulnerable to predicaments like the Ukrainian Invasion compared to any other country. When oil becomes more scarce the need unfortunately doesn’t. The price for oil will surge. It’s like rare baseball cards or antiques. The rarer it is, the more expensive it gets. That is why we are seeing absurd gas prices.
Is this the sacrifice Americans are willing to take to help Ukraine fight for their independence?
- Joshua Stender, STLCC Student
