SAN FRANCISCO, Calif. (KRON) – If it seems like you’ve been paying more at the pump lately, you have and much of that is tied to concerns over the Russian-Ukraine conflict.
“Russia is a supplier of natural gas and oil and oil is one of their main sources of revenue so essentially there will be less oil available on global markets and if there is less oil there is less gas and process go up,” economics professor Matthew Holian said.
But financial experts say there may be something to offset that if Russia stops the flow.
“We are negotiating with Iran at the moment and we could get a nuclear deal there and that would open up a supply of oil to the world market so there are a lot of moving parts to this,” global strategist Gary Schlossberg said.
While prices at the pump have gone up, the uncertainty has sent other prices down.
“It’s going to have an influence already on financial markets and the returns people are getting on their investments and the biggest problem becomes and the more uncertainty there is the bigger that effect can be,” economist Don Hanna said.
The Biden administration has already initiated sanctions against Russia and Don Hanna with UC Berkeley says that will also have impacts.
“There’s also supply chain issues and that will likely rise from the sanctions that have already been put in place that will disrupt supply chains and exacerbate problems we have already seen as a result of COVID-19,” Hanna said.
Russia and Ukraine are also big exporters of grains. If either or both spouts are shut off, it could lead to a rise in some food prices here in this country, but financial experts think that is unlikely.
“It’s in the interest of both sides to continue to see these exports to import these materials to keep their economies functioning smoothly so the hope is that like most geopolitical disturbances this will be short-lived,” Hanna said.
While there are still many unknowns, financial experts seem to agree the economic impact of this conflict will be far less than those we saw as a result of COVID-19 back in 2020.