High Gas Prices and its Effect on Students

The Russian invasion of Ukraine has thrown the global economy into a freefall. Particularly, the United States is facing these economic effects, most prominently through the price of gasoline. 

 

Starting in late February, the United States and its European allies began imposing sanctions on Russia. One of the largest sanctions was the United States’ ban on Russian oil, liquefied natural gas, and coal exports. These resources are key to energy and fuel production. Russia ranks as the fourth biggest crude oil exporter and third-largest exporter of gasoline to the United States, right behind other countries like Canada, Mexico, and Saudi Arabia. Despite these sanctions, the United States still receives a high amount of gas and fuel exports from more than 10 countries. 

 

The conflict between Russia and Ukraine is not the sole cause of price spikes. Inflation has already been on the rise over the past years. Compared to an inflation rate of 3.2% in 2011,  the inflation rate increased to 8.5% in 2022, the highest rate the United States has seen in 40 years. This steep increase in inflation was caused by supply chain disruptions and increased consumer demand for goods, especially after the reopening of the global economy in 2021. Due to inflation, the cost of living skyrocketed, making it harder for the working American to earn enough money to live a comfortable and stable life. As the world continues to recover from the drastic economic effects of COVID, prices are gradually starting to decrease. 

 

Students shared their view about rising gas prices. Senior Jasmyn Lew states, “I try to avoid traffic to lessen how much gas [I] waste. I don’t really drive as much anymore because gas has gone up and I don’t feel like paying almost $6 per gallon. I stopped driving every night just cause and I stopped really driving home from school as much.” The students interviewed also express some interests in electric vehicles. Ryan Duong, a senior with an electric Volkswagen, has expressed that he will “no longer drive long distances with gas vehicles” and will instead wait until he, “has the opportunity to use my electric vehicle”. However, concerning purchasing an electric vehicle, Jasmyn expressed that electric cars are “too high maintenance and service is too expensive”, and would instead have a hybrid. 

 

The public shares mixed opinions about high gas prices. Private fuel and gas companies are in charge of the prices. Some people feel that these large multi-millionaire companies are taking advantage of the current pandemic and the Russian-Ukraine conflict to maximize profits. For example, Shell has earned a record $19.29 billion in 2021, which is $4.85 billion more than their profits in 2020. On the counterhand, fuel companies argue that they don’t control the prices; the availability of gasoline around the world controls it. However, only three percent of crude oil was supplied from Russia and 65 percent was produced domestically in 2021. President Biden weighed in on the argument by issuing a stern warning to companies competing against other companies for record profits, but it is unsure if companies will oblige and reduce their prices.

 

An alternative to increasing gas prices are Electric cars. Electric cars are now three to six times cheaper compared to their gasoline counterparts. The Zero Emission Transportation Association (ZETA) released a new paper in March 2022 calculating the effect of increased gasoline prices on cost of operation compared to electric vehicles. Nationally, electric vehicles are three to five times cheaper to drive per mile than gasoline vehicles. In California, the average gas price was $5.69 per gallon while the average energy price for kWh was $0.23. Electric cars can hold approximately between 30 and 80 kWh depending on the model.