U.S. crude oil prices top $90 a barrel for the first time since November 2022

Oil prices jumped on Thursday, with U.S. crude topping $90 a barrel, as expectations of a tighter supply grew.

West Texas Intermediate crude (WTI) gained 1.6% to reach a high of $90.04 per barrel, touching its highest level since November 2022. Brent crude was up 1.7%, at $93.47, reaching a 10-month high. WTI crude last traded at $90.02 a barrel.

Saudi Arabia and Russia have extended their oil output cuts to the end of 2023, and the move could result in a substantial market deficit for the rest of 2023, the International Energy Agency said on Wednesday.

“From September onwards, the loss of OPEC+ production… will drive a significant supply shortfall through the fourth quarter,” the agency said in its monthly report.

Rising crude prices could mean higher gasoline prices at a time when the economy is trying to recover and solve the inflation problem. Inflation, measured by the Consumer Price Index, posted its biggest monthly increase this year in August as energy prices fed much of gain, rising 5.6%, an increase that included a 10.6% surge in gasoline.

WTI crude is up almost 3% this week, on pace for the third straight weekly gain. The prices are up about 13% this year.

Earlier this week, the OPEC issued updated forecasts of solid demand and also pointed to a 2023 supply deficit if production cuts remain.