“Household and business inflation expectations have reached very high levels, and they could rise further if the Russian invasion of Ukraine causes energy prices to spike or disrupts supply chains,” wrote Goldman Sachs in a note Monday warning of higher and more persistent inflation than previously forecast.
On that knowledge, the Biden administration Placed restrictions and sanctions on the Russian energy of oil and Natural gas, in addition of cancelling the Nord Stream 2, a new pipeline ready to transfer natural gas from Russia to Europe for reduced prices.
The price of a gallon of diesel hit $4 a gallon for the first time in nearly eight years over the weekend. Although few Americans drive diesel-powered cars, most large trucks use it. And just about all goods sold in the United States are moved by truck at some point.
The trucking industry itself has been facing challenges for years, mostly due to a shortage of drivers. The higher fuel costs will be passed on by trucking companies in the form of fuel surcharges. So all businesses will have to pay higher transportation costs. With already high inflation, they are likely to pass along those costs to consumers.
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