This week’s headlines included updates on the Russia-Ukraine situation, the mass disappearance of the 3G network, and how trucking and microchips have a closer relationship than you may have thought of. This weekend top military experts warned how Russia might begin its invasion if they chose to do so. “Aerial bombardments” followed by a “swift and violent” troop movement throughout the rural parts of the region would take place first before moving into major populated cities such as Kyiv. With the European Union warning of “massive sanctions” if Russia invades Ukraine, the effects could be devastating for prices if the situation continues to progress as it currently stands.
However, in a shocking move by Russia amid extremely high tensions in the east, Russia withdrew a reported 150,000 troops from the Russia-Ukraine border this week. President Biden spoke on Tuesday about how this situation could continue to impact oil prices. “I will not pretend this will be painless, there could be impact on our energy prices. So, we are taking active steps to elevate the pressure on our own energy markets to offset raising prices,” Biden said during a briefing at the White House. For context, Russia was the third-biggest supplier of foreign petroleum for the United States in 2020 (EIA). They are responsible for 7% of all imported oil and exported $13 billion in mineral fuels to the States in 2019.
Lastly, this week we talked more about how the impact of microchips are affecting different industries. With demand heavily outweighing supply for microchips, consoles, computers, and other semiconductor products, heavy delays in production remain a significant issue. The global chip shortage has been an ongoing crisis affecting over 150 countries. Today, most vehicles have anywhere between 1,400 and 3,000 microchips built into them. While 50% of chip production worldwide is for personal electronics, vehicles occupy a large chunk, accounting for nearly 15%. At the beginning of the pandemic, when people were getting used to a stay-at-home life, vehicle manufacturers had an incorrect prediction – that sales would drop. To read more about the topic Trucking & Microchips – By the Numbers, click here.
Prices in Review
WTI Crude opened the week at $93.91. Prices spiked from Monday to Tuesday before falling back down throughout the week. Crude opened Friday at $91.63, a decrease of $2.28 from Monday.
Diesel opened the week at $2.9364. Diesel followed the same trends as crude before opening Friday at $2.7909, a decrease of $0.1455 from Monday.
Gasoline opened the week at $2.7434. Prices followed similar patterns to crude and diesel, moving mostly down throughout the week before opening Friday at $2.6502, down $0.0932 from Monday’s opening price.