U.S. gasoline prices are expected to rise to record levels again this summer following a surprise decision by OPEC to cut crude oil production. OPEC, which controls about 40% of the world's oil export trade, is cutting 1.5 million barrels per day (bpd) of overproduction and will cut its official production quota by 1 million bpd to 23.5 million bpd starting April 1.
According to The Brock Report, Saudi Arabia pushed the cuts to offset an anticipated downturn in usage this spring. While there are doubts some OPEC members will adhere to the agreement, many market observers now see U.S. crude oil prices remaining above $30/barrel the remainder of the year.