Crude oil prices may soon exceed $100 a barrel, a former White House energy official said on Monday.
The warning comes after the Organization of Petroleum Exporting
Countries (OPEC) and its allies announced plans to cut crude production
by over one million barrels per day.
- Brent crude settled at around $83.94 a barrel on Monday after jumping as much as 8.4% following news of the cuts.
- The cuts came as global oil stockpiles were low.
- Onshore oil inventories around the world fell for seven of the past nine weeks, according to oil data and analytics firm Vortexa.
- Decreased oil supply is likely to further deplete inventories, which may contribute to additional upward price pressures.
- OPEC members decided to cut crude production in a bid to counteract downward price pressures on the price of oil.
- The cartel expects a global economic slowdown to decrease oil demand and thereby lower prices.
- OPEC successfully predicted a glut in global oil demand when it cut production by 2 million barrels in October last year.
