Pull-Ups or gas? How inflation and sanctions play out day to day.
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Sarah Matusek Staff writer
| Denver
Despite Americans鈥� widespread support for sanctions against Russia, sticker shock at the pump has burdened consumers already shouldering 40-year-high inflation. For those just trying to get by, it鈥檚 yet another test of patience.
鈥淚t鈥檚 tight out here, man,鈥� says Kendall Billips at a Denver gas station a week ago, filling up his red van with $4.70-a-gallon premium gas. His nearby toddler clutches a doll. 听
Fuel aside, a month鈥檚 worth of food to feed their family of six cost $300 before the pandemic, but now $700 or more, says his wife, Carlissa Barrott. That鈥檚 made them cut down on snacks, despite protestations from their kids.
Why We Wrote This
Families already squeezed by inflation are now facing higher gas prices partly due to a ban on oil imports from Russia. Despite that, many Americans are willing to make that additional sacrifice in support of Ukraine.
鈥淚 got to deal with the pouting and the crying,鈥� she says.
Still, she supports sanctions against Russia, 鈥渂ecause what Putin鈥檚 doing is unnecessary.鈥�
Politics at the pump
In response to Russia鈥檚 invasion of Ukraine, President Joe Biden announced March 8 that the United States would ban all Russian oil. Though Russia provided of all crude oil and petroleum products imported to the U.S. last year, it鈥檚 a top global exporter, and when demand overtakes supply the price per barrel tends to increase.
Early March polls show roughly 听to of Americans are willing to shoulder higher fuel costs caused by sanctions. That鈥檚 despite annual reaching 7.9%, the highest in four decades.听
Yet the Feb. 24 invasion of Ukraine only partly explains why recent trips to the gas station are stressing wallets. Between February 2021 and February 2022 鈥� as states reopened and demand for travel grew 鈥� gasoline costs .听
Beyond the price of crude oil, variables like state taxes and transportation costs make for a patchwork of gas prices across the country. Nationally, the average price of regular gas stands at $4.24听per gallon, down from a record $4.33 on March 11, according to . Adjusted for inflation, however, that mid-March peak still hasn鈥檛 topped a July 2008 high听that would cost听around $5.30 a gallon in today鈥檚 dollars.听
Even though oil prices have dipped听from recent highs, energy experts note there鈥檚 typically a lag between falling oil prices and what drivers pay.听听
鈥淲hen the price of crude goes up, those increases are almost immediately reflected in gas prices,鈥� said Ellen Edmonds, AAA public relations manager, in an email. 鈥淗owever, when the price of crude goes down, it takes a little longer for consumers to see those savings.鈥�
For temporary relief, some states are considering gas tax holidays, which and have recently enacted. And while some governors and lawmakers are calling to pause the federal gasoline tax 颅鈥撎�18 cents a gallon 颅 鈥� consumers would save more from the state level as those taxes are generally higher, says Shon Hiatt, associate professor at the University of Southern California Marshall School of Business.
鈥淭he hope of doing these gas holidays is to get through what they think could be the worst,鈥� says Professor Hiatt, noting that sizable state revenue surpluses make the tax cuts more manageable. 鈥淭he big question is will prices settle down.鈥�
Gas versus diapers
Fluctuating fuel costs set back consumers in additional ways. This month , , and听 announced the introduction of temporary fuel surcharges. In Los Angeles, food truck owner John Ou is tacking on fuel surcharges to catering gigs.
The owner of The Fix on Wheels, known for its burgers, says he鈥檚 increasing a 15% service fee to 20% to offset the expense of driving. Mr. Ou says he didn鈥檛 make the decision lightly 鈥� he鈥檇 already upped the price of menu items in 2021 to keep pace with rising costs of materials and ingredients. A box of latex gloves that cost him $4 pre-pandemic now sets him back $12, for example.听
鈥淲e鈥檙e getting clobbered on the supply chain, we鈥檙e getting clobbered on food costs, on materials costs, and now on gas prices,鈥� says Mr. Ou.听
Mr. Ou says he鈥檚 frustrated by high pump prices in California, which at some gas stations this month have surpassed听$6. And he resists the either-or assumption that complaining about gas prices suggests he doesn鈥檛 care about Ukraine. He says he backs the sanctions to some extent, while also acknowledging that they hurt 鈥渙therwise innocent鈥� Russians. But 鈥渢hat doesn鈥檛 mean I can鈥檛 complain or I鈥檓 insensitive to the Ukrainian plight when I鈥檓 being clobbered,鈥� he adds.听
Soaring inflation triggered the by the Federal Reserve this month, the first increase since the pandemic began. The move is a 鈥渄ouble-edged sword,鈥� says Carly Urban, associate professor of economics at Montana State University. The attempt to reduce demand and rein in prices also means higher interest rates for lower-income consumers, who purchase more things on credit, she says. These Americans are already considered by inflation overall.
In northeast Washington, D.C., LaToya Francis has watched inflation stretch her budget for several months.
鈥淚t鈥檚 everything from bread to milk to a pack of chicken wings,鈥� says the certified nursing assistant. 鈥淚鈥檓 literally torn between Pull-Ups and gas on a weekly basis.鈥�听
While raising a preteen and toddler, she says steep prices have made it harder to save, further delaying her dream of a nursing degree. The front-line worker has been about raising wages for direct care workers like herself, whose grueling work environments are stressed by staffing shortages.听
Ms. Francis says she sometimes augments her full-time job at a nursing home with shifts as a home health aide in Virginia, but that鈥檚 a two-hour drive round trip. In an early March interview, she wondered how much longer she could keep either job due to gas.
Three weeks later, Ms. Francis says she still can鈥檛 afford to fully fill听her tank.听Despite this frustration, she explains her support for President Biden鈥檚 sanctions against Russia in a text: 鈥淚 wish there was more we could do without triggering a world war.鈥�
