The gas industry is far-reaching. Even people who have transitioned to electric cars have experienced this phenomenon in one way or another. Much of the world is reliant on both gas and oil to function. It fuels manufacturing and processing powers and runs almost all forms of transportation. It even allows essential goods to travel across the country in trucks.
However non-special the idea of transportation may seem, it is a massive deal. Think about all the businesses and services that need some form of transport for their line of work. This is all made possible because of the gas and oil industry. And if the prices of both get too expensive, it might translate into workers losing their jobs. Meaning that it falls back on the consumer to make up for profit loss.
Like what happened in the middle of the COVID-19 pandemic, gas prices have recently soared. The reason behind both of these cases is very different. (You can find more on the causes of the pandemic’s here) But it sends the same message about how powerful gas and oil are.
When amidst a war, especially after a crippling pandemic, economies find themselves weakened. Partly due to the expenses required to keep a country moving. Which poses the question, what if a country exploits that weakness?
Intentional or unintentional, that is what Russia is doing. As one of the largest petroleum exporters in the world, a war with Russia means war without much gas supply. This holds especially true for North Macedonia, Bosnia and Herzegovina, and Moldova relying only on Russian gas. Finland, Latvia, and Bulgaria rely on Russian gas. And Germany, Italy, Poland, and France do the same. This is according to data from the European Union Agency for the Cooperation of Energy Regulators from recent years. It also goes over the many countries who get some small part of their supply from Russia all the same.
Despite this, you may have noticed that the US is not part of that list and is still so affected in the industry. This is because the US has made a move to ban all oil, natural gas, and coal imports from Russia completely. But, what’s crazy is that according to Bloomberg, the US imports from Russia made up about 3% of shipments in 2021. If banning 3% of imports on gas, oil, and coal caused one of the biggest rises in gas prices in the US, then losing all of it would be a disaster.
Further proof of this discrepancy is found when using a direct comparison of prices. According to Global Petrol Prices, a gallon of gas in Russia costs about 2.35 USD. If you compare that to the number in the US of 4.51 USD per gallon, it looks pretty bad. And it is pretty bad.
Most important, this is not only an issue within the United States. As mentioned before, for the countries that rely on Russian gas, this is an international issue. And one that has the potential to be much more catastrophic. Part of this stems from the socio-political burden that countries have to either support Ukraine or Russia, whether they choose to. In banning Russian products, their economies may be doomed. At the same time, in not acting, there may be criticism targeted toward a country from its population over the chosen actions. Still, that is not to say that banning Russian exports is the only way to speak out against them, but it is a big move.
Overall, having to pay a few more dollars for gas is difficult for many people. Still, this extends to many aspects of one’s economic life that are easy to dismiss. It is not only a burden on wallets. The context behind this particular gas shortage sends a message about the power of monopolies and reliance on countries. As long as that persists in today’s world, it’s unlikely that the high gas prices will decrease.
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