U.S. consumers are going to start feeling pain in their pocketbooks again as crude oil prices rose on Monday, squeezing American consumers amid the most aggressive inflation in over a decade.
A barrel of Brent Crude rose to $72.88, the highest price since October of 2018. West Texas crude was trading around $70.90, also the highest since October of 2018.
Crude prices have been persistently climbing this year as global demand rises and U.S. investment in oil production is stymied by the Biden administration’s anti-fossil fuel policies.
Gas pump prices hit $3.08 on Monday, three cents higher than a week ago.
“Motorists are paying, on average, 37 percent more to fill up than the start of the year,” said Jeanette McGee, a spokesperson for AAA. “Prices for the rest of the month are likely to push more expensive, but if crude production increases, as forecasted, there is the possibility of seeing some relief at the pump later this summer.”
Not everyone agrees that prices are likely to come down. Analysts say that the push for electric vehicles and the threat of higher taxes and more regulation are depressing investment in oil production. Commodities investor Leigh Goehring recently told the Wall Street Journal that consumption will top production capacity for a sustained period. The situation could produce “the next oil crisis,” Goehring said.
Planned investment in oil supply globally falls nearly $600 billion short of what will be needed to meet projected demand by 2030, according to an analysts at J.P. Morgan Chase.
Inflation has hit American consumers hard on other goods and services. “Prices for nonferrous metals spiked 6.9% in May while beef and veal; diesel fuel; gasoline; hay, hayseeds, and oilseeds; and motor vehicles also saw increases. Prices for fresh fruit and melons fell 1.9% primary basic organic chemicals and for asphalt also declined,” according to Fox Business.