Writer: Sara Suarez
2 min read March 2022 — Average gas prices in Miami-Dade have soared to $4.23 per gallon, almost doubling since last year, according to AAA, fueled in great part by sanctions levied in response to the Russia-Ukraine war. The rise has only added to the inflation Floridians have been feeling in recent months.
Sanctions related to technology for petroleum refining were announced last month by President Joe Biden in response to Russia’s invasion of Ukraine. Although the measures were aimed at “technology exports that would support Russia’s refining capacity over the long term,” the fallout was felt almost instantly by American consumers at the pumps as Russia saw its ability to export crude crippled.
Despite the higher gas prices, 67% of Americans, according to a Washington Post-ABC poll, approve of the sanctions. Support stayed above 50% even when it meant higher energy prices at home. The results are even higher in polls by NPR/PBS/Marist, which showed general support for sanctions at 89% and sustained support at 69% when they lead to higher gas prices.
But exactly how much will the war increase inflation? Federal Reserve Chairman Jerome Powell thinks it’s too early to tell. “The implications for the U.S. economy are highly uncertain, and we will be monitoring the situation closely,” he said last week during the Semiannual Monetary Policy Report to Congress. Powell made the comments as part of an address on the current economic situation and outlook for the nation before the Committee on Financial Services and the U.S. House of Representatives.
Data shows that from the moment Putin announced a “special operation” in Ukraine on Feb. 24, prices of gas in the United States started escalating. Four days later, prices were already 2.12% higher on average in the country. Today, Invest: calculates there has been a 17.33% increase in gas prices on average since Feb. 21.
The United States, along with the United Kingdom, the European Union, Japan and Canada have put together a comprehensive list of sanctions aimed at discouraging Putin’s closest allies from supporting the invasion, summarized here by the Financial Times.
According to the official press release by the US Treasury, additional sanctions include a total foreign asset freeze and travel restriction on the Russian President Vladimir Putin’s family and inner circle of friends. In addition, Russia’s oligarchs, military and security officials, parliament and council members, state-owned banks and media bureaucrats are also facing sanctions. The Office of Foreign Assets Control (OFAC) of the US Treasury is ensuring Russian private companies, including major financial institutions, are also prohibited from moving or increasing their assets across Western financial markets. The OFAC has issued “eight general licenses authorizing certain transactions.” The aim is to protect access to energy and COVID-19 activities to protect regular Russian citizens from the burden of war.
UPDATE: Following the release of this article, President Biden announced a nationwide ban on all oil, coal, and gas exports from Russia for domestic use. The strategy seeks to cut the “main artery” of Russia’s economy as the country is responsible for 11% of the world’s supply of crude oil according to the US Energy Information Administration.
