Are You Ready for 7 Dollar Gas, Lubbock?

Inflation is in a 40 year high, and everyone is feeling the pinch. If you made a hundred thousand dollars last year, it would only be worth 92.5 thousand dollars today with 7.5% inflation. Even though many people are making more money at their jobs, it may not be covering the difference in inflation. Unfortunately, things could be about to get worse. 

Gas prices are important because it takes gas to get things for one place to another. Everyone needs to use gas including manufacturing, groceries, and retail. If gas prices go up, the price of everything goes up, and now we have a strategist that sees $7.00 dollars a gallon gasoline.  

Energy Word Founder Dan Dicker states, “My guess is that you are going to see $5 a gallon at any triple-digit [oil prices] ... as soon as you get to $100. And you might get to $6.50 or $7. Forget about $150 a barrel, I don't know where we will be by then.” Due to the tensions with Russia, gas prices have been going up, and if Russia invades the Ukraine, then it could get much worse. Another cause is that summer is coming and with Covid numbers starting to go down, you could see a lot of travel. Gasbuddy head of petroleum analysis, Patrick DeHaan said, “I see no other potentials in the short term but additional price increases unless Russia does an about-face on Ukraine. Even then, we’ll still see seasonality push prices up, so motorists should be ready to dig deeper.” 

I know that these are all just worst-case scenarios, but as Russia has circled the Ukraine. Also, Russia wants gas prices to go up because that is a major part of their GDP. Another potential issue is that Joe Biden has made a huge push for electric vehicles, would this make electric more affordable? Could President Biden want prices to go up? If gas prices hit 7 dollars a gallon, what will the inflation rate be then, and how will it affect the upcoming elections? It is a lot to think about, but things are changing fast, and it is good to be prepared.