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US ban on Russian oil could raise gas price at the pump – CBS Pittsburgh

PITTSBURGH (KDKA) – West Virginia US Sen. Joe Manchin and other lawmakers are calling for a ban on Russian oil to the United States.

But that could mean higher petrol prices at the pump. At a news conference late Thursday, Manchin said America must prevent Russian oil and other fossil fuels from entering that country.

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“Energy has become a weapon of war for Putin and he uses it as a weapon of war. He uses it against all of Europe, if you will. Basically, Ukraine is the catalyst of what he is doing,” Manchin said.

Manchin is leading a bipartisan group of lawmakers with a bill to shut down the American market, particularly to Russian oil, which American oil producers are still buying, albeit at low levels, says University of Pittsburgh energy economist Prof Jeremy Weber.

“Russia does not export a tremendous amount of oil to the United States. We import maybe about 5 percent of what we consume,” Weber told KDKA money editor Jon Delano on Friday.

The US consumes about 18-20 million barrels of oil a day, and about 600,000 barrels come from Russia.

Manchin says he’s spoken to big oil producers, who say they can already pull out of Russia and get oil elsewhere without hurting American consumers.

“I said I need you to do something else. They must commit that the American economy and the people of the United States will not be adversely affected by corporate profits or shareholder profits or whatever during this time of crisis. They all said that this is also a matter of national unity for us,” Manchin said.

WATCH: Jon Delano reports

Prof Weber says domestic oil producers can tap some wells already drilled and drill for more oil, but it’s not fast or mandatory.

“That doesn’t mean that a company can bring all of these uncompleted wells into production in a day, two, or a week. This will need time. And they may not want to do everything at once. What if they expect prices to keep rising for the next few months?”

The ban on Russian oil — while obviously a strong moral statement in Ukraine’s favor — could increase the cost at the pump, Weber says.

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“Refiners will be able to replace these barrels, but they may not be quite the same and they need to make some adjustments to cope. And those adjustments could mean higher costs that would be passed on to consumers,” says Weber.

While a growing group of lawmakers want to ban Russian oil, President Joe Biden has so far been cool about the idea. Gasoline prices are skyrocketing in this region and nationwide to over $4 a gallon in this state, says AAA.

While Manchin says Putin’s attack on Ukraine is criminal and that he shouldn’t be reaping war profits from Russian oil, Russia is one of the top three oil producers. So shutting down this oil could be costly for consumers.

“You’re sitting at $3.95 a gallon in Pittsburgh right now, but that’s 25 cents more than gas was in Pittsburgh two days ago,” said Lynda Lambert, a spokeswoman for AAA.

Some oil companies have already stopped buying Russian oil, causing Russian exports to fall by a third. This leads to shortages and higher prices.

Weber says while we don’t import much Russian oil, American oil producers are in no rush to drill more at home. We have the same number of active rigs this week as last week and US oil production is the same as four weeks ago. This creates a shortage when we need more oil.

“Our supplies of crude oil and gasoline have been declining and demand is increasing, which is also complicating prices and causing them to rise even without the Russia-Ukraine conflict,” says Lambert.

bottom line. Gasoline is getting more expensive as Americans travel with this easing of the pandemic. If you find gas under $4 a gallon, fill up immediately. It’s not likely to go back down for some time.

LEFT:

Gas prices from state to state

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Cheap gas in Allegheny County

https://pittsburgh.cbslocal.com/2022/03/04/ban-on-russian-oil-in-the-us-could-add-to-price-of-gasoline-at-the-pump/ US ban on Russian oil could raise gas price at the pump – CBS Pittsburgh

TaraSubramaniam

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