WASHINGTON (TND) — A massive block of the world's oil producers announced plans to cut production Wednesday — just as demand was rising.
The Organization of the Petroleum Exporting Countries (OPEC+) announced it will cut oil production by 2 million barrels a day. That's the largest drop since the beginning of the COVID-19 pandemic, and experts worry it could lead to a dramatic price spike.
The group said the decision was based on the “uncertainty that surrounds the global economic and oil market outlooks.” Saudi Energy Minister Abdulaziz bin Salman stressed the group’s stated role as a guardian of stable energy markets.
“We are here to stay as a moderating force, to bring about stability,” he told reporters.
Wednesday's potentially devastating news is compounded by job numbers showing the U.S. labor market is starting to cool. To discuss all of this, plus the new economic forecast by the World Trade Organization, Brandon Arnold, executive vice president of the National Taxpayers Union, joined The National Desk Thursday.
When asked what Americans can expect to see in the weeks and months to come, Arnold's outlook wasn't positive.
"I think what we're going to see, obviously, is higher gasoline prices. And I'm not sure they'll get back to those levels that we experienced in June, where we had astronomical gas prices, but I think something more in the range of 15-, 20-, even 25% increase in gasoline prices is likely from this decision."
For more of Arnold's interview with The National Desk's Jan Jeffcoat, check out the video above.