What Will Happen To Oil Prices If The World Goes To War Over The Ukraine
A few weeks ago, I bet most of you would not have been able to place a former Soviet republic called Ukraine on a map. But now, due to a dispute with its rather large neighbour called Russia, world stock prices have collapsed while Oil and Gold prices have surged as investors bet on a full-blown confrontation in the very near future.
It is a long way from two years ago when oil companies were actually giving away oil when they ran out of storage space due to Covid restrictions. Now, for a fleeting moment yesterday, Brent Crude (one of the benchmark crudes) actually went above the USD100 per barrel mark for the first time since 2015.
Simon Williams, a spokesperson for the Royal Automobile Club (RAC), has predicted that the price at UK pumps will hit 149.12 pence (USD2.01) per litre very soon. Across the pond, the US media is already bemoaning the fact that the price per gallon has risen by 80 cents per gallon to an average of USD3.51 per gallon over the past twelve months. This is equivalent to USD0.92 per litre, but the prediction is that this will go up to USD1.50 per litre in places where there is high petrol tax like California. This is really going to hurt US consumers who a few years back were being told that they had achieved energy independence.
A big part of the problem is that Russia is currently the second-largest oil producer in the world and as much as 25-30% of European electricity is produced using gas that flows along Russian pipelines, some actually through Ukraine. What this all means to us is that the cost of everything will go up. There is nothing that is not transported to market these days and when the cost of the fuel goes up, then the cost of the product being transported has to go up. These increases, called inflation by mere mortals like us, will no doubt become a long-term price regardless of whether the conflict in Ukraine is real or just posturing.
Is there anything we can do as we go about our normal daily routines? Well, not much except making sure that your car is maintained in tip-top condition so that you are not wasting precious fuel. So, maybe it is time to look at X-1R again to see how by using a small bottle of Space Technology, you can reduce your fuel bills.
