Tyler Schipper, an associate professor of economics and data analytics at the University of St. Thomas, spoke with KSTP about how escalating tensions in the Middle East could affect gas prices. Schipper explained how geopolitical uncertainty influences oil markets and why concerns about future supply can lead to higher prices at the pump, even before any actual supply disruptions occur.
From the story:
Experts say part of the pricing strategy is about what ‘might’ happen with the war – and the market response.
“If markets now believe future conflict is more likely, they also have to price in the possibility that future supply could be lower,” says Tyler Schipper, an economics professor at the University of St. Thomas. “That pushes prices up.”
Schipper says gas consumers shouldn’t worry about long lines at the gas pump just yet – he notes there are enough reserves for now.
But he adds it takes time for global inventories to be refilled – and we may not see prices drop again for possibly a year or more.
