For most of us, the COVID-19 pandemic is over, even with McHenry County still in the “high” range. People can still catch it. Some require hospitalization, and, sadly, some patients don’t make it. But we’ve reached the point where businesses are open, travel is allowed, and even masking is rare. However, the pandemic continues to impact our lives through the basic economic principles of supply and demand. During the pandemic, there was much less travel, so petroleum businesses decreased production. Inexplicably, they shut down some refineries. It’s the nature of business to largely focus on the immediate future and not to look too far ahead. Another example is that the airlines decreased staffing and now are caught short-staffed.
With the pandemic now effectively over, there’s a greater need for fuel for all transportation modes. We would think that the prior supplies would instantly reappear. Unfortunately, it doesn’t work that way. Petroleum products remain in short supply despite the growing demand. Therefore, prices went up – Economics 101. Because virtually every human endeavor depends on transportation, the prices of most products have increased. Then there are staff shortages and other business ramifications that lead to short supplies. All of these factors led to drops in the markets.
It may be comforting for some to blame everything on President Biden. But post-pandemic supply and demand economics would be the same even if we had a Republican administration. Inflation is worldwide, not limited to the United States. With gas prices starting to drop, perhaps Biden isn’t so bad after all.