The Russia-Ukraine conflict’s effect on the former’s domestic automotive industry has been generally negative in terms of growth and development. However, analysts have cautioned that the energy crisis exacerbated by the war is likely to also exasperate the broader European market and beyond.
Oil prices reached a high of US$130 per barrel in Q2 of 2022—up from US$70 the previous year, according to Statista—and the outlook for dropping below US$100 in the foreseeable future is pessimistic. According to the US Bureau of Transportation Statistics, gasoline and diesel prices rose 49% and 55% respectively between January and June 2022. At the peak, both fuels cost over US$5 per gallon. At the same time, a similar situation played out in Europe: gasoline reached €2.66 (US$2.80) per litre in Norway, while diesel prices in the UK exceeded £2.11 (US$2.59). In an interview with CBS, Jamie Dimon, Chief Executive of JPMorgan, opined that while Europe would survive the winter of 2022/23, “this oil and gas problem is going to go on for years.”