- Rising oil prices, attributed to Saudi Arabia and Russia cutting back on oil production, are leading to increased fuel costs for drivers, truckers, and farmers.
- The surge in oil prices has attracted investors, causing speculation that prices will continue to rise. However, there is still plenty of oil in the world to meet current demand.
- Higher oil prices benefit Russia by generating more revenue to support its invasion of Ukraine and offset the impact of Western sanctions.
- Some analysts think oil could hit $100 a barrel based on robust demand and limited supply.
- “Much of the price surge beyond $85 per barrel is due to a flood of speculative money, while fundamentally there is still plenty of oil in the world to meet demand for now,” said Gary Peach, oil markets analyst at Energy Intelligence.
- Oil is Russia’s main moneymaker, so higher prices help the Kremlin pay for its invasion of Ukraine and weather sweeping Western sanctions aimed at crushing its wartime economy.
- The U.S. Energy Information Administration reported that oil production averaged 12.8 million barrels a day in June, up 1 million barrels from 12 months ago, close to the levels achieved before the pandemic began in 2020.
