NASHVILLE, Tenn. (WTVF) — Gas prices are rising amid the conflict with Iran in the Middle East.
According to CBS News, crude oil prices jumped more than 8% to just more than $81 a barrel, the biggest single-day gain since May of 2020.
At home, that means the cost of your gas is likely to rise significantly.
"This is a disruption for the whole system, for the whole world," said Julio Rivas, an economics and finance professor at Lipscomb University.
He explained that much of our oil comes from the Middle East. When there's a threat, shipping companies avoid the area, access is limited, and production grinds to a halt. That means there's less supply for the rest of the world, and prices start to rise.
While gas is the most obvious impact, Rivas warns the cost of other goods could also spike.
"Here's a ripple effect enough...if gas prices go up, it might be more costly for [people] to operate, right? It might be more costly for them to drive around and deliver or do whatever they need to do, so then I have to charge more money, right? And that is...when you see the inflation effect," said Rivas.
He tells consumers not to panic. Economic shifts often come with a war or a conflict. The current cost of gas all depends on how long the conflict abroad persists. While that timeline is still up in the air, what you can do is spend smartly.
"Budget," he suggested. "Make sure if you're driving, it's something that you really need to do. If you can carpool and figure out ways to spend less gas, do it."
Do you have more information about this story? You can email me at nikki.hauser@newschannel5.com.
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