OPEC+ Unleashes Inflationary Shock: US Gas Prices on the Cusp of a Surge
In a surprise move, OPEC+ announced Sunday that it would slash oil production by over 1.6 million barrels per day starting in May, marking a sudden shift towards reduced output. The news has sent shockwaves through global energy markets, with Brent crude futures and WTI, the US benchmark, skyrocketing by around 6% in trading on Monday.
The impact of this move will be felt at US gas pumps sooner rather than later. Gasoline futures have already begun to rise, with wholesale prices up about 8 cents per gallon – a 3% increase that will likely be passed onto drivers more quickly than the spike in oil prices. This news has set off alarm bells for many experts, who warn that it could reignite inflationary pressures.
"This is a wake-up call," said Tom Kloza, global head of energy analysis for OPIS. "OPEC is reawakening the inflation monster, and the White House will be shocked by this move." According to Kloza, the national average for US gas prices stands at $3.51, but he expects prices to surge in the coming days, potentially reaching $3.80 to $3.90.
Kloza notes that while the US has managed to keep prices relatively low due to the Strategic Petroleum Reserve's releases and increased oil production, a cut of this magnitude is difficult to offset. However, Kloza acknowledges OPEC+'s ability to reduce production and its motivation behind this move.
The implications of this new development are far-reaching. While some experts predict that prices will not reach record levels seen in 2022 – when gas averaged $5.02 per gallon – others warn that prices could rise again if global demand is affected by hurricanes or other weather events along the Gulf Coast.
In any case, Monday's news serves as a stark reminder of the interconnectedness of global energy markets and the potential for unexpected shocks to the system.
In a surprise move, OPEC+ announced Sunday that it would slash oil production by over 1.6 million barrels per day starting in May, marking a sudden shift towards reduced output. The news has sent shockwaves through global energy markets, with Brent crude futures and WTI, the US benchmark, skyrocketing by around 6% in trading on Monday.
The impact of this move will be felt at US gas pumps sooner rather than later. Gasoline futures have already begun to rise, with wholesale prices up about 8 cents per gallon – a 3% increase that will likely be passed onto drivers more quickly than the spike in oil prices. This news has set off alarm bells for many experts, who warn that it could reignite inflationary pressures.
"This is a wake-up call," said Tom Kloza, global head of energy analysis for OPIS. "OPEC is reawakening the inflation monster, and the White House will be shocked by this move." According to Kloza, the national average for US gas prices stands at $3.51, but he expects prices to surge in the coming days, potentially reaching $3.80 to $3.90.
Kloza notes that while the US has managed to keep prices relatively low due to the Strategic Petroleum Reserve's releases and increased oil production, a cut of this magnitude is difficult to offset. However, Kloza acknowledges OPEC+'s ability to reduce production and its motivation behind this move.
The implications of this new development are far-reaching. While some experts predict that prices will not reach record levels seen in 2022 – when gas averaged $5.02 per gallon – others warn that prices could rise again if global demand is affected by hurricanes or other weather events along the Gulf Coast.
In any case, Monday's news serves as a stark reminder of the interconnectedness of global energy markets and the potential for unexpected shocks to the system.
, surrounded by oil prices going up 
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️, with a price tag increasing 
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, looking at an oil barrel with a red X marked through it 
]
and don't even get me started on the weather events experts are saying hurricanes could affect prices even more... it's like they want us to suffer 
. The timing couldn't be worse either, with hurricane season just around the corner... Interesting that OPEC+ made this bold move – will it pay off or blow back on them? 
. experts are warning that inflationary pressures are coming back and I don't blame them. i mean, $3.51 is already kinda high for a gallon of gas, but if it gets up to $3.80-$3.90 then yeah that's just not cool 
this just smells like a conspiracy to me... OPEC+ slashing production on the sly? it's gotta be some kind of plan to control the price, you know? 
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this opec+ move is gonna hit us hard! i dont think we can afford another round of $5+ gas prices, especially with inflation already on the rise 
. what were they thinking? 
i was thinking of buying a new car this summer but now maybe ill have to put it on hold due to rising gas prices 
what's goin on?! i know gas prices are supposed 2 be low but like this sudden drop? 6% in one day?! that's wild 
my wallet is already shaking just thinkin bout it 
we'll have to monitor this situation closely and see what happens next 
... just think about it, another price hike on top of everything else 
... just give me a break. Mark my words, this is gonna cause problems for regular folks who are already struggling to make ends meet