The economic impact could also move beyond the gas pump, Wall Street analysts warn. Sanctions or export controls against Russia could make current semiconductor shortages even worse, while restrictions on wheat or metals could drive the fiercest bout of inflation in decades to climb even higher.

“If Russia makes a run on Ukraine, we could see [oil prices] over $100 a barrel next week,” said Patrick DeHaan, head of petroleum analysis at GasBuddy, adding that average gas prices across the U.S. are likely to hit $4 a gallon in the weeks or months to come. “That $4 is something we haven’t seen in so long — it would cause shock waves across America,” he said. Russia could retaliate by halting oil and natural gas exports, DeHaan said. “The world economy does depend on global energy. How does the world sanction Russia’s economy without Russia saying, ‘We’re going to take the next step for you and not export any more energy’?” he asked. “If Russia’s economy is going down the tubes, they’re going to take the global economy with it.”

The White House is considering another release from the Strategic Petroleum Reserve, the Washington Post reported Tuesday, and U.S. officials are planning to divert more natural gas to Europe.

Russia also produces just under half of the world’s palladium and smaller portions of platinum and nickel — key elements in complex microchips that are used in “everything from electrical meters to sophisticated BMWs,” said RSM Chief Economist Joe Brusuelas.

Ukraine is Europe’s top producer of uranium and has vast deposits of titanium, manganese, iron and mercury, Peter Boockvar, chief investment officer at Bleakley Advisory Group, said in a report. “Because commodity prices are as high as they are, any disruptions will really matter,” he said. “What we’re talking about is another round of supply shocks in the developed economies. As costly as another European war would be in human and economic terms, its economic burden in the United States would fall hardest on the middle and working classes,” “Should energy prices increase more than our baseline expectation of 20% to, say, near 40%, we will be talking about a premature end of the business cycle,” Brusuelas noted. 

“As today’s turnaround in global markets highlights, perceptions about the risks around the conflict in Ukraine have become an increasingly important factor over the past few weeks,” Jonathan Petersen, markets economist at Capital Economics, said in a report. “Since the start of February, oil and safe-haven assets (such as gold and US Treasuries) have appreciated, while equities and some currencies (e.g., Russian equities and the ruble) have come under pressure.”

Read more at source at CBS News.