You may have noticed that you’re already paying an average of 16 cents more per gallon of regular unleaded gas and eight cents more for diesel in Indiana since Russia’s war in Ukraine began on Feb. 24.
What you’re paying on the farm for gasoline and diesel fuel may likely go up even further with one reason being the outcome of President Biden’s sanctions on Russia following their invasion of Ukraine.
“Russia is basically the second largest oil producer globally just neck-and-neck with Saudi Arabia so they are a significant piece of what the global market needs in terms of oil supply,” says Patrick DeHaan, Head of Petroleum Analysis for Gasbuddy.com.
DeHaan says if Russia decides to retaliate against U.S. sanctions by withholding crude oil, that supply wouldn’t otherwise be met by increasing U.S. oil production or importing oil from another country.
“The only OPEC producer that has really any spare capacity is Saudi Arabia and so far, President Biden has asked them twice to increase production and they haven’t done so. There really is no contingency plan if Russia decides to slow down its oil exports,” says DeHaan.
However, DeHaan says if you fill up across Indiana, there has been a price break on unleaded gasoline because refineries are trying to get rid of their winter gasoline supply, which is cheaper to produce. He says fuel prices will also go up once the switch is made by refineries to the summer blend in March. That summer blend of gasoline is a higher-grade fuel that can add up to 15-cents per gallon.
Click BELOW to hear the full interview with Patrick DeHaan with GasBuddy.com and hear his thoughts on how much higher fuel prices could go for Hoosier farmers.