Oil's inflationary bite: OPEC+ cuts set US gas prices soaring.
In a surprise move, the oil-producing cartel OPEC+ announced on Sunday that it would slash its oil production by over 1.6 million barrels per day, starting in May and running through to the end of the year. The news sent shockwaves through global energy markets, causing Brent crude futures and WTI, the US benchmark, to skyrocket by around 6% in trading on Monday.
The immediate impact was seen on gasoline futures, which will be passed down to US drivers much more quickly than a spike in oil prices. RBOB, the most closely watched wholesale gasoline price, rose by about 8 cents per gallon, or 3%, in morning trading.
According to Tom Kloza, global head of energy analysis for OPIS, which tracks gas prices for AAA, OPEC's move will "reawaken the inflation monster" and send US gas prices soaring. The White House is likely to be shocked by the news, as it alters the calculus for a while, making it even more challenging to control rising inflation.
As of Monday, the national average for US gas prices stood at $3.51, according to AAA. Kloza predicts that prices could rise to around $3.80 to $3.90 in relatively short order due to the OPEC production cut. However, he notes that US drivers are unlikely to reach record levels of $5 a gallon anytime soon.
While there's still hope that prices won't get too out of control, Kloza points out that the US is planning additional releases from its Strategic Petroleum Reserve and has seen improvements in oil production and refining capacity since 2022. Nevertheless, an OPEC production cut of this magnitude will be tough to make up for.
For now, it seems that OPEC's decision will have a profound impact on global energy markets, with prices set to rise significantly over the coming weeks and months.
In a surprise move, the oil-producing cartel OPEC+ announced on Sunday that it would slash its oil production by over 1.6 million barrels per day, starting in May and running through to the end of the year. The news sent shockwaves through global energy markets, causing Brent crude futures and WTI, the US benchmark, to skyrocket by around 6% in trading on Monday.
The immediate impact was seen on gasoline futures, which will be passed down to US drivers much more quickly than a spike in oil prices. RBOB, the most closely watched wholesale gasoline price, rose by about 8 cents per gallon, or 3%, in morning trading.
According to Tom Kloza, global head of energy analysis for OPIS, which tracks gas prices for AAA, OPEC's move will "reawaken the inflation monster" and send US gas prices soaring. The White House is likely to be shocked by the news, as it alters the calculus for a while, making it even more challenging to control rising inflation.
As of Monday, the national average for US gas prices stood at $3.51, according to AAA. Kloza predicts that prices could rise to around $3.80 to $3.90 in relatively short order due to the OPEC production cut. However, he notes that US drivers are unlikely to reach record levels of $5 a gallon anytime soon.
While there's still hope that prices won't get too out of control, Kloza points out that the US is planning additional releases from its Strategic Petroleum Reserve and has seen improvements in oil production and refining capacity since 2022. Nevertheless, an OPEC production cut of this magnitude will be tough to make up for.
For now, it seems that OPEC's decision will have a profound impact on global energy markets, with prices set to rise significantly over the coming weeks and months.
The US gas price surge is no surprise to me at all! I mean, think about it - we've been hearing for ages about how OPEC+ is trying to "rebalance" the market by reducing production. It's like they're playing a big game of supply and demand, and it looks like they're ready to take control. The thing is, this move will definitely have a ripple effect on inflation... and let's be real, we all know how that ends up 
. The good news is that US drivers aren't likely to reach those crazy $5/gallon levels anytime soon, but I'm still keeping an eye on it. With the additional releases from the Strategic Petroleum Reserve and improved oil production/refining capacity since 2022, things might just stabilize eventually... but for now, get ready to shell out a bit more cash at the pump! 
OMG, I'm so hyped about gas prices right now... I mean who doesn't love saving money at the pump? 
I'm telling you, something fishy is going on here. First of all, why did OPEC decide to cut production now? Is it just a coincidence that this happens right before the US presidential election? 
. The White House is already worried, so it's likely that there are some hidden forces at play here. Mark my words, this OPEC move is just a small part of a larger game they're playing with energy prices and inflation. Stay vigilant, folks! 
. How are we supposed to afford everything else when our money goes straight into the tank 
. What about people on fixed incomes or tight budgets? They're already struggling to get by 
They're trying to make a buck, but also keep prices stable in the Middle East and Europe. The thing is, our economy is kinda tied to theirs, so when they cut production, that ripples out to us. But can we blame them? They gotta make ends meet too!