The long simmering tensions in Eastern Europe have reached their boiling point with Russian forces beginning their most recent incursion into Ukraine. Officials there said Thursday that the country’s military was fighting on three fronts to repel a “full-scale invasion” of Russia.
The Russian Defense Ministry has confirmed that its ground forces have moved into Ukraine from Crimea, the first confirmation from Moscow that its ground forces have moved in.
The Biden administration has been steadfast is its stance that no U.S. ground troops will be used to defend against Russia, but has reassigned troops to Germany, Poland, and Romania for defensive footing. The President said earlier in the week that the United States has “no intention of fighting Russia.”
Unfortunately, that does not mean the renewed conflict over contested regions of Ukraine will have no impact on the citizens of the United States — including those living in Surry County. For weeks as the sabers were rattled and missives released almost daily from Washington saying the invasion was imminent, consumers have been understandably nervous.
Already rattled by supply chain issues and inflation the likes of which has not been seen for decades, the stock market and investors are skittish about what is now a full shooting war in Eastern Europe.
Financial planners are advising investor restraint. “Stock market drawdowns from geopolitical shocks average about 5% with recovery taking under two months,” said local financial advisor Skyler Harrison.
“There may be some market opportunities for very active traders during the crisis, but for most investors we believe understanding the typical market response to geopolitical risks and focusing on where we’re likely to be at the end of the year rather than at the end of next week or month is likely the best response.”
“Hold tight. The market does not like uncertainty, so holding tight is the way to go,” Kyle Leonard of Truliant echoed about market uncertainty.
“Honestly, if you didn’t make a move by now it’s too late. You’d be operating now on pure emotion, and you don’t want to invest on emotion alone.” If possible, he did suggest reallocation of some assets to short term bonds as a potential safe landing spot.
Where most Americans will feel the pinch is at the pump, a place few can afford to see another increase. Global oil prices temporarily rose to above $100 a barrel on Thursday after the invasion of Ukraine, hitting triple digits for the first time since 2014.
Patrick De Haan of GasBuddy said Thursday that where tanker trucks are loading up at this moment is where the price of gas changes in real time, it takes time for those changes to reach locally. “The increase will play out of the next few days, and will be evenly distributed across the country. North Carolina should see their price of gas rising with the national average. Most states will see prices go up by 5 to 10 cents over the next two weeks.”
De Haan emphasized if the conflict in Ukraine does not get any worse, he feels confident the national average will remain below $4 a gallon, with California perhaps being the only state to cross $5 a gallon.
Natural gas prices also climbed in Europe Thursday with prices climbing by 60%. De Haan referenced Russia as a major natural gas exporter who could chose to limit supply to drive up prices. The US Energy Information Administration reports domestic natural gas prices rose 20 cents since last Wednesday.
Surging crude oil prices are good news for oil companies and producers’ bottom line but will lead to higher prices at the pump and economists feel, even more inflation.
A sampling of seven Mount Airy gas stations found gas prices at six locations were within three cents of one another.
“Yesterday it went up cents, and it was 20 cents earlier in the week,” advised Ryan Kunkel of the 76 station located at 1645 South Main, Mount Airy. He has seen the price of regular unleaded shoot up this week ten cents from Wednesday to Thursday. “There may be another jump (of) 20 cents coming soon.”
His station along with some others in the area are supplied by Davenport Energy, who have partial influence over the local price of gas. Kunkel said, as did other local station employees, that he tends to see prices locally stay within a close range of one another. With one exception, all local stations contacted Thursday reported regular gas at $3.57 – $3.59 per gallon.
AAA says the average price nationally is $3.54, up 20 cents from one month ago. North Carolina saw its average for the same period go up 30 cents per gallon on regular, and diesel month over month is up 40 cents per gallon.