A Statistical Analysis of the Impact of the Russia-Ukraine War on Gas Prices

Abstract

During the five-month period between January and June of 2022, the price of gasoline in the United States increased by 49%, while diesel prices increased by 55%. Some individuals have attributed the price spike to the Russia-Ukraine War. To delve deeper into the issue, I will examine the sources of price changes in the United States gasoline market by using ordinary least squares and fixed effects regressions to analyze gasoline price data between January 2004 and March 2022. Additionally, I will distinguish between two key impacts on gasoline prices in 2022: the beginning of the Russia-Ukraine conflict in February and the implementation of sanctions limiting the import and export of petroleum products to Russia in March. The results of my study suggest that the sanctions enacted had a significant impact on gasoline prices in the United States, and had more gravity compared to the start of the war.