(NewsNation) — Saudi Arabia announced it was planning to cut oil production by 1 million barrels a day starting next month, a move that will likely raise gas prices in the U.S.
Though the cutback is set to start in July, Saudi Arabia could keep it up far beyond that.
Currently, gas costs an average of $3.50 a gallon nationwide, an increase from six months ago when the national average was $3.33. One year ago, gas was averaging $4.85 a gallon, according to GasBuddy.
“Let them (Saudi Arabia) speak for their decision to cut production. What we’re gonna stay focused on is making sure that there’s a balance between supply and demand, you see the price of oil was not dramatically affected by this announcement of these additional cuts, and price of gasoline continues to come down. So the President’s gonna stay focused on what’s best for the American people what’s best for our economy,” White House National Security Council Contributor John Kirby said.
In 2022, the U.S. imported more than 8 million barrels of oil a day. Of that, 1.25 million barrels came from the Organization of the Petroleum Exporting Countries, while just 560,000 barrels came from Saudi Arabia, according to data from the Energy Information Administration.
At last check, crude oil prices were trading at about 1.5% higher. If prices do increase, the impact is expected to be felt in mid-July.
One analyst tells NewsNation the price of crude oil could jump another $10 a barrel by the end of the year.
