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'The markets are simply reacting to the uncertainty' | Economics professor weighs in on high gas prices

The ODU professor says he wouldn't be surprised to see prices rise to $5 per gallon as Russia's invasion of Ukraine continues.

NORFOLK, Va. — While Russia's invasion of Ukraine takes place, gas prices spike day after day here in Hampton Roads and the United States. 

Prices at the pump in our area had risen to more than $4 per gallon as of Monday.

According to AAA, prices topped highs that we saw in 2008, when the average cost hit $3.98. Many are asking how long these prices will last.

Vinod Agarwal, an economics professor at Old Dominion University, said as the West tightens sanctions on Russia and the conflict continues, there is a lot of uncertainty.

"The markets are simply reacting to the uncertainty as to what is going to happen with the price of oil," he said.

Agarwal said he wouldn’t be surprised if prices went up to $4.50 by the end of the month and keep going up.

"If you had asked me last month I would have said about $4 a gallon, now I’ll say $5," he said.

Contrary to popular belief, Agarwal said the executive branch has little to no say in gas prices.

"Obviously, the war did not get started by the President of the United States, so how in the world could you blame them, I do not know," he said. "It all depends on what Middle Eastern countries do in pumping oil. They’ve obviously not increased production."

As for how long these high prices last?

"It will depend upon the duration of the war and the uncertainties associated with it," Agarwal said.

That being said, he says one positive long-term effect from this conflict could be a stronger Western economy. He said that’s because this conflict has seemingly made NATO stronger than it was before.

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