Russia’s invasion of Ukraine sparked oil prices to soar past 100-dollars Thursday morning for the first time since July 2014. Executive director at the Center for Energy Studies at LSU, David Dismukes, says inflation is already high and the Russia-Ukraine will only push prices higher.
“Not just in crude oil, but in agricultural commodities, metals, everything across the board is up 6-to-8 percent Thursday morning, this is just going to make a bad situation even worse,” said Dismukes.
Gasoline prices are also expected to rise. According to Louisiana Triple-A, the statewide average for a gallon of regular gasoline is $3.31. That’s the highest they’ve been in eight years. Dismukes says gasoline prices could exceed four dollars a gallon if demand remains high.
“If people start to contract, consumer sediment starts to fall, you start to see people saving more much like they did during COVID, and you start to see gasoline demand move down that might ease some of that pressure on how high those gas prices go,” said Dismukes.
Louisiana Agriculture Commissioner Mike Strain is also worried about rising prices as a result of the Russia-Ukraine conflict. Strain says Ukraine has some of the most fertile soil in the world and is a major exporter of wheat and grain and now the supply for these bread-making ingredients is tightening.
“And now the supply and demand across the world is so tight that this is very significant,” said Strain.
Strain says Russia is a major exporter of natural gas, which is needed to produce fertilizer. He says the cost of fertilizer is already high.
“That will drive the commodity prices and that, in turn, will end up at the end of the day the cost that our consumers will have to pay for food at the grocery,” said Strain.
Comments