OPEC+ Steps Up Production Cut, Squeezes US Gas Prices Higher
A surprise move by OPEC+ to slash oil production has sent shockwaves through the global energy market, pushing up gas prices in the United States. The cartel announced on Sunday that it will reduce oil output by over 1.6 million barrels per day, effective May and lasting until year-end.
The decision sent oil futures surging, with Brent crude and WTI rising around 6% in Monday's trading session. This, in turn, has had a ripple effect on gasoline prices, which are expected to be passed on to consumers at the pump. Gasoline futures saw an 8-cent-per-gallon surge, or a 3% increase, in morning trading.
Energy expert Tom Kloza of OPIS, which tracks gas prices for AAA, believes that OPEC's move will "reawaken the inflation monster." The White House is likely to be "shocked and majorly annoyed" by this development, as it alters the economic calculus. Kloza estimates that US gas prices could rise to $3.80-$3.90 per gallon in the near term.
It's worth noting that despite current prices being just below last February's average of $3.53 per gallon, Kloza believes prices won't return to those levels anytime soon. This is largely due to the US Strategic Petroleum Reserve (SPR) plans to release more oil, as well as an increase in domestic production and refining capacity.
However, Kloza acknowledges that OPEC+ has the ability to cut production, and it seems motivated to do so. As a result, he believes prices won't get back to $5 per gallon anytime soon – although prices might rise again if there's another hurricane or storm affecting Gulf Coast production.
One thing is certain: the US gas price will continue to be influenced by global events and market dynamics. With OPEC+ taking steps to reduce oil output, it's likely that drivers will see higher prices at the pump in the coming months.
A surprise move by OPEC+ to slash oil production has sent shockwaves through the global energy market, pushing up gas prices in the United States. The cartel announced on Sunday that it will reduce oil output by over 1.6 million barrels per day, effective May and lasting until year-end.
The decision sent oil futures surging, with Brent crude and WTI rising around 6% in Monday's trading session. This, in turn, has had a ripple effect on gasoline prices, which are expected to be passed on to consumers at the pump. Gasoline futures saw an 8-cent-per-gallon surge, or a 3% increase, in morning trading.
Energy expert Tom Kloza of OPIS, which tracks gas prices for AAA, believes that OPEC's move will "reawaken the inflation monster." The White House is likely to be "shocked and majorly annoyed" by this development, as it alters the economic calculus. Kloza estimates that US gas prices could rise to $3.80-$3.90 per gallon in the near term.
It's worth noting that despite current prices being just below last February's average of $3.53 per gallon, Kloza believes prices won't return to those levels anytime soon. This is largely due to the US Strategic Petroleum Reserve (SPR) plans to release more oil, as well as an increase in domestic production and refining capacity.
However, Kloza acknowledges that OPEC+ has the ability to cut production, and it seems motivated to do so. As a result, he believes prices won't get back to $5 per gallon anytime soon – although prices might rise again if there's another hurricane or storm affecting Gulf Coast production.
One thing is certain: the US gas price will continue to be influenced by global events and market dynamics. With OPEC+ taking steps to reduce oil output, it's likely that drivers will see higher prices at the pump in the coming months.
. I mean, who doesn't love watching their paycheck shrink faster than a gazelle on Red Bull 
? The whole OPEC+ thing is like a big game of supply and demand, and they're basically playing the role of the bully who always wins 
. I'm no expert, but I'm pretty sure 'reawakening the inflation monster' sounds suspiciously like code for "we're gonna make your wallet cry" 
. Anyway, if gas prices are gonna skyrocket to $3.80-$3.90 per gallon, at least we can all take comfort in knowing that our roads will be cleaner because we'll need those fancy electric cars 
.
but now that prices are slightly lower, some folks seem to be taking it for granted 
i get it though, the global energy market is all about supply and demand, and opec's move might just be an attempt to control things they know?
Gas Prices About to Get a Bump 
. I think this move will be good for some countries in the Middle East, but bad news for drivers like us who have to shell out more cash at the pump 
. Not sure what that means exactly, but I know I'll be feeling the pinch in my wallet 
and I'm like "what's up with those gas prices?!?" 
about this one. Tom Kloza's predictions are on point though 
, gas prices could jump up big time. But let's be real, we're still getting more oil from the SPR and domestic production, so it's not all doom and gloom 
. We just gotta expect higher prices for a bit 
So like OPEC+ just announced they're gonna cut back on oil production and it's already sending shockwaves through the market! 
️ The prices are gonna go up, like duh, but also in a good way? 
But for real though, I'm so down for this move! 
Can't wait to see what happens next! 
. Guess all those extra bucks from your paycheck are going straight into the tank 
. I'm not convinced this is about more than just a global game of cat and mouse...
like isnt opec already making us pay through the nose for our energy then now theyre cutting back even more and were stuck with higher gas prices 
its so frustrating, can we just have some stability for once? i know there are people who will say oh but global demand is low or whatever, but come on cannt we afford a little bit of inflation right now? 
so yeah i just saw this news about opec+ cutting production and it makes sense why gas prices are gonna go up 
[A simple flowchart showing OPEC+, oil production, and gas prices]
but also bad for US consumers 
like cloza said, the inflation monster might just wake up again 
), but it's nice to see experts like Kloza keeping an eye on things 
Anyway, I'm guessing $3.80-$3.90 per gallon is like, no joke for most people, especially on a budget 
