The recent decision by OPEC and its allies to decrease oil production will have a direct impact on gas prices in the US. This move by OPEC+ involves reducing oil production by over 1.6 million barrels per day, set to begin in May and continue until the end of the year. This announcement caused Brent crude futures and WTI to increase by approximately 6% during trading on Monday.
As a consumer, you may be wondering how this news affects you. The change in production levels will lead to a swift rise in gasoline futures, which will swiftly translate to higher prices at the pump for US drivers. The wholesale gasoline price, RBOB, surged by about 8 cents per gallon, or 3%, in morning trading.
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According to Tom Kloza, the global head of energy analysis for OPIS, this decision by OPEC could revive concerns about inflation. With gas prices in the US currently averaging $3.51, we may see this figure rise to $3.80 to $3.90 in a short period due to the production cut.
While gas prices may not reach the levels seen during the tensions in 2022, factors like hurricanes or storms disrupting production along the Gulf Coast could lead to further increases. Our expertise in software outsourcing and technology maintenance can help streamline your operations in times of market fluctuations, ensuring optimal performance and efficiency.
It’s worth noting that last year, after Russia’s invasion of Ukraine, gas prices had spiked to $4.19 per gallon. Although we are currently below that mark, the recent actions by OPEC could push prices upward as the industry adjusts to the production cut.
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