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OPEC expected to cut oil production
At a meeting Wednesday, analysts expect OPEC to announce its cutting oil production, which would drive up the price of crude.
CHICAGO - After a late-summer drop, gas prices are once again on the rise.
At a meeting Wednesday, analysts expect OPEC to announce its cutting oil production, which would drive up the price of crude.
As a result, you can expect pain at the pump to get worse before it gets better.
"We're getting a little bit of a reality check with gasoline prices going back up," said FOX Business Analyst Phil Flynn.
While gas prices are still down from where they peaked in June, here in Chicago, the average price of regular unleaded — $4.81 per gallon according to Triple-A — is once again starting to push dangerously close to the dreaded $5/gallon mark.
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"We've got the Federal Reserve raising interest rates because inflation's too hot, that could impact demand and slow the economy, so OPEC is using that as justification for a big production cut," said Flynn.
Flynn predicts OPEC will soon announce it's cutting production by at minimum 500,000 barrels per day on the low end and said he wouldn't be surprised if it cuts production by three or four times that, which would significantly drive up the price per barrel.
"If that happens, what we're going to see is the price of oil really start to go up and that's going to very much displease the Biden administration," said Flynn.
Right now, the average price of regular unleaded sits at $4.16 a gallon in Illinois, $4.81 in Chicago.
The OPEC announcement could come as early as Wednesday.
If it does go as expected, don't be surprised to be paying $5/gallon in the coming weeks.