Michigan gas prices expected to rise with Ukraine invasion
PHOTO Meghan Maier
March 15, 2022
Russia’s invasion of Ukraine will have major economic impacts for countries around the world, including the U.S.; one of these impacts is the rapid rise in oil prices around the country.
Russia is the world’s third largest oil supplier, producing 12 percent of the world’s oil supply and eight percent of the U.S.’.
Phillip Braun, professor of Finance at Northwestern’s Kellogg School of Management, stated to Northwestern Now, “The market for oil is global, and the removal of Russia from the global supply chain has and will continue to push the price of oil up… whether oil is coming from the strategic reserves or elsewhere, its price is set in the international markets, and it will continue to climb as the Ukraine crisis continues.”
At the start, the U.S. allowed some oil to be exported into the U.S from Russia— even with the sanctions. Even with this loophole, gas prices continue to climb. In Michigan, gas prices rose 10 cents over the span of a single day, reaching some of the highest cost per gallon in the nation.
Gary Bubar from the Auto Club Group (AAA) Michigan told Fox 2 News, “We’ve seen crude oil go to a spot now that we haven’t seen in 10 years. Gas prices right now are the highest they’ve been since 2014.”
With gas increasing to be over $4, some may consider it unaffordable at this point, especially for high school students working on minimum wage.
“I work about 25 minutes away and the drive there and back every day is starting to really add up,” senior Aubrey Yager said. “I used to fill my car for $40 and now it takes $60. As a high school student, I can’t be spending that much on gas when I have other things I have to pay for, like spring break and college.”
At the Mobil gas station located on Owen Road in Fenton, customers have seen gas prices reach $4.25 per gallon, partly because of the sanctions on Russia.
During his State of the Union Address on March 1, President Joe Biden said, “I’m taking robust action to make sure the pain of our sanctions is targeted at Russia’s economy. I will use every tool at our disposal to protect American businesses and consumers. Tonight, I can announce that the U.S. has worked with 30 other countries to release 60 million barrels of oil from reserves around the world. America will lead that effort, releasing 30 million barrels from our own Strategic Petroleum Reserve. We stand ready to do more if necessary, unified with our allies. These steps will help blunt gas prices here at home. I know the news about what’s happening can seem alarming.”
As the war continues, gas prices may be expected to hit almost $5 per gallon, hitting consumers here at home while the U.S. continues to put more sanctions on Russia.
