Russian oil - not that big a deal if we stop having it

You may have heard that President Biden decided to ban US imports of oil from Russia today. That's despite oil spiking to $125 a barrel and gas exceeding $4 a gallon nationwide after Russia's invasion of Ukraine.

This led me to ask "How much oil are we talking about?" And fortunately, today's US trade report has some of this data. In particular, it measures how many barrels of oil we bring in from Russia (and other countries) along with how much it costs, along with other petroleum trade data.

Russia doesn't make up a whole lot of our imports - barely 3% last year, and less than that in the two years prior.

By comparison, we import almost many barrels of oil from Colombia (66,486 from Russia vs 63,795 from Colombia). We also get more than 3 times as many barrels from Mexico, and more than 20 times as many from Canada. I know we're coming up on Summer and a higher need for barrels, but it seems to me that Russia's numbers could be easily made up from several other places - including America itself.

Let's not forget that White House Press Secretary Jen Psaki noted recently that US oil companies have as many as 9,000 unused drilling permits, and at $125 a barrel, you'd think that could be a wortwhile venture. But that won't solve the $4-$5 gas problem in the short term, so for the next couple of months, perhaps there should be a price ceiling pn oil and gasoline to lessen the cost to the consumer, while the US government makes up the difference with subsidies to producers and gas stations to lessen the chances of shortages.

I theorize that inflation is often a benefit to government coffers in the short term, if demand stays strong and no recession happens (which is the case today). Expenses are fixed for the year while tax revenues go up, so there should be the funds available to do such subsidies. With the 10-year note under 1.9% and the dollar near 2-year highs, deficits are not an economic problem.

So while I originally had concerns about cutting off oil imports from Russia in a time where speculators and other profiteers have driven up the price of gasoline, Russian product such a small amount of American consumption that it's well worth the minor reduction on our side to give them more significant pain. It's not gonna be fun in the next few months, and certainly Americans are going to have to adjust their demand for oil as well as probably some other items. But it's also something we can get through if we are smart, and if we hammer the bad guys both here and abroad.