HOUSTON - While Russia is unleashing its wrath on Ukraine, consumers could end up feeling more pain at the pump.
President Joe Biden says more barrels of oil may be released to stop the price of gas from going up. However, a leading oil analyst says we could still pay up to $0.20 more per gallon in the next 7 to 10 days.
Addressing the nation Thursday, President Biden warned oil and gas companies not to exploit the invasion to raise gas prices on consumers.
"We are actively working with countries around the world to elevate collective release of strategic petroleum reserves of major petroleum consuming countries. And the United States will release additional barrels of oil as conditions warrant," President Biden said in his address.
Andy Lipow, head of oil consulting firm Lipow Oil Associates, says gas prices could still jump up to $0.20 cents higher as the market anticipates a possible supply disruption from Russia.
"Should we see an impact to oil supplies, whether the west bans Russia from selling, or Russia decides to cut off those supplies, prices are going to go up even more," said Lipow.
Lipow points out a number of options that could alleviate that. More strategic reserves could be released, as President Biden suggested, Saudi Arabia, the UAE, and Kuwait could be pressured to release more, or Congress could suspend the $0.18 cent federal gas tax.
Meantime, Russian President Vladimir Putin says he won't cut off global supplies of natural gas.
But if he does, Lipow explained, "Right now natural gas is nearly $5 per million Btu’s. That could possibly rise to $6 per million Btu’s."
Bottom line, potentially higher fuel prices could mean harder times on top of high inflation.
"This is bad news for the economy as a whole. The energy, price-wise, is going to ripple through the economy for all those goods and services that are delivered, as well as all the agricultural prices," said Lipow.
But Lipow says there is light at the end of the tunnel for consumers, as oil prices always eventually come back down. He points out that in 2008, oil rose to more than $145 a barrel, then dropped to $35 just six months later.