Gas prices at historic highs as Russia, Saudi Arabia extend oil cuts

Gas prices in the United States rose to the highest seasonal level in more than a decade on the same day Russia and Saudi Arabia agreed to extend their voluntary oil production cuts through the end of 2023. The move was expected to trim 1.3 million barrels of crude out of the global market and boost energy prices.

State-run Russian news agency Tass quoted Alexander Novak, Russia’s deputy prime minister and former energy minister, saying Moscow would continue its 300,000 barrel a day cut.

Saudi Arabia’s announcement, carried by the state-run Saudi Press Agency, said the country still would monitor the market and could take further action if necessary.

“This additional voluntary cut comes to reinforce the precautionary efforts made by OPEC+ countries with the aim of supporting the stability and balance of oil markets,” the Saudi Press Agency report said, citing an unnamed Energy Ministry official.

The oil cut announcements from Russia and Saudi Arabia sent the price of benchmark Brent crude above $90 a barrel in trading on Tuesday, Sept. 6. Brent had largely hovered between $75 and $85 a barrel since October of 2022. White House national security adviser Jake Sullivan was asked about the price jump at a briefing Tuesday.

“As far as I’m concerned, the most important thing that the president is focused on is just trying to do everything within his toolkit to be able to get lower prices for consumers at the gas pump in the United States,” Sullivan said. “It’s really the price of a gallon of gas for the American consumer, the question of which country is doing what, here or there, that is going to be his ultimate metric for whether we’re succeeding or not.”

The national average price for a gallon of gas in the U.S. was $3.803 on Wednesday, Sept. 6, according to AAA. That’s down slightly from Tuesday’s national average of $3.811, the second highest average price on record going back to 1994.