Gasoline Prices To Rise With OPEC+ Decision
OPEC+ has decided not to raise production levels. They would rather see oil prices rise to make more money per barrel. This is more likely to happen because the Chinese economy is also slow. China is the largest importer of crude. The US is the largest oil producer in the world, but there is no sign of changing output.
“The grouping’s production cuts help Trump, because they keep the price elevated to a point that US producers can turn a profit at; more than any action the president can take, it’s the price that determines whether “drill, baby, drill” happens or not,”
Oil prices have hovered around $67. This has been based on the very slow spread of violence in the Middle East and a stalemate in Ukraine. However, if either of these situations becomes unstable, oil will rise.
Preserving Oil
Without OPEC+, there is no supply buffer except for the Strategic Petroleum Reserve. A wrinkle could bring crude back to just shy of $100, where it was just over two years ago.
$100 crude is $5 gas. $5 gas threatens the growing and stable US economy by raising inflation.
OPEC+ was a wildcard. Now, it is a worry.
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