In a bad omen for inflation, US oil prices exceeded $90 a barrel for the first time this year.

New York
CNN
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US oil prices rose above $90 a barrel on Thursday for the first time in 10 months, threatening to push gasoline prices higher and… Inflation heats up throughout the economy.

High oil prices have already created an unusual situation where gasoline has become more expensive even after the summer driving season ends. Despite the decline in demand, gas prices are only a few cents away from their highest level of the year.

National average for regular gasoline It rose to $3.86 per gallon on ThursdayAccording to AAA. This is six cents higher than a week ago and 16 cents higher than the same day last year.

The recent rally in the oil market has been driven by concerns about supply.

First, Saudi Arabia and Russia The market was surprised last week By extending strict supply cuts until the end of the year.

then, Catastrophic floods in Libya Raised concerns about Supply disruptions in that OPEC member country. at least 5,000 people died in Libya Thousands more are feared missing.

“If all of this supply in Libya was taken off the market for a long period of time, that would push prices up,” said Andy Lipow, president of consulting firm Lipow Oil Associates.

Libya, Europe’s main supplier, produces about one million barrels of oil per day, according to OPEC. Most of this crude is the same light, sweet variety found in Texas, New Mexico and elsewhere in the United States.

“If you lose that supply in Europe, that will push up prices there and attract more barrels from the U.S. to fill the gap,” Lebo said.

US crude was trading at a high of $90.26 a barrel on Thursday morning, up 2% on the day. This is the highest intraday price since November 8, 2022 and also represents a 34% jump since mid-June.

Brent crude, the global benchmark, rose 2 percent to its highest level in ten months at $93.68 a barrel on Thursday.

The recent jump in energy prices is undoing some of the progress central banks have made in combating inflation.

A pair of inflation reports were released this week Prices showed a higher-than-expected rise in August, in large part Due to high gas prices. Energy prices have only risen so far this month.

There are now a dozen U.S. states where the average price of a gallon of regular gasoline is $4 or more, including Colorado, North Dakota and California, according to AAA.