Future Impact of Russian Oil Ban on American Gas Prices
LOS ANGELES (CBSLA) - Gas prices have been breaking records in Southern California with many stations passing the six dollar mark in recent weeks.
President Biden is asking Americans to brace for more increases — after he blocked Russian oil imports in the latest rounds of sanctions against Vladimir Putin's unprovoked attacks on Ukraine. Since then, the price at the pump in America has gone up almost 75 cents and with this action — it's going to go up further.
"I'm going to do everything I can to minimize the price hike here at home," said President Biden.
The President announced the release of 60 million barrels of oil from a joint oil reserve with global partners. Gas Buddy says the national average is up 58 cents a gallon from a week ago.
"The good news is the pace of that increase will now slow down," said Patrick DeHaan of Gas Buddy. "You shouldn't have to worry about going outside and seeing gas prices going up 40 cents a gallon."
Some say prices wouldn't be so high if the United States stepped up its oil production.
"The U.S. is the largest oil producer in the world by far," said economist Chris Thornburg who teaches at UC Riverside.
He says American oil production dropped at the start of the pandemic when low demand drove the price of a barrel into negative territory. He thinks high gas prices could turn that around.
"They are rehiring some of their old folks and they're going out to get new lateral drills and they're going to start getting oil out of the ground again," said Thornburg.
While gas prices have gone up — they are relatively low when adjusted for inflation and cars are more fuel efficient that they were during generations when the price of fuel had greater impact.
Sarah Bialkin recently moved to the Southland and with the rising price of gas — she's glad she came to Los Angeles with a hybrid car.
"I'm willing to make that sacrifice if it's going to save lives and end the war faster," said Bialkin. "I can't go over there and fight but I can definitely use gas a weapon. If that's going to make the Russians stop invading then that's fine."
Local gas prices are well above the national average and if there are any surprises during the local refinery maintenance season, then the prices could get pushed beyond what is happening in Ukraine.