(ConservativeFreePress.com) – On Sunday, the Saudi Arabian government stated that they would voluntarily cut oil production by around one million barrels per day. They are currently the largest oil producer in the Organization of Petroleum Exporting Countries and announced that despite OPEC’s previous claims that there would not be any alterations to production plans in 2023, they would reduce production from 10 million to 9 million barrels.
With Saudi Arabia cutting oil production, it is likely that gas prices in the U.S. are going to rise over the summer. Patrick De Haan, head of petroleum analysis at GasBuddy, stated that there was an increase in oil prices on Sunday night, with the market opening up to approximately $75 a barrel, however, that large increase did not stick for long, as the price had dropped to $72 by Monday morning. De Haan argued that in the short term, American consumers would likely only see a difference in gas prices in cents, however, the national average might rise within the next few weeks.
De Haan also pointed out that one of the reasons for the lower gas prices this year when compared to last year is that there are many who are concerned about a possible economic slowdown, as well as the recent concerns about a possible federal debt default and the recent bank failures.
He proceeded to note that last year, the U.S. had to take a significant supply from the strategic petroleum reserve in order to reduce gas prices last year after the large spikes. He added that if there is an increase in demand, it could potentially result in the market being worried about the limited supply.
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