Gas prices hit 2023 highs as oil remains hot – WSVN 7News | Miami News, Weather, Sports

New York (CNN) — Prices at the pump climbed to their highest level of the year on Monday as oil prices rose above $92 a barrel.

Typically, gas prices cool off after the summer driving season ends on Labor Day. But this year the opposite has happened, as aggressive supply cuts by Saudi Arabia and Russia drive up oil prices.

According to AAA, the national average for regular gas reached $3.88 per gallon on Monday, the highest price since October 2022. In the past week alone, gasoline prices have increased five cents per gallon.

Rising pump prices are an unpleasant sight for consumers, the Federal Reserve and the White House as they threaten to undo progress against inflation.

Although the national average is well below the record high of $5.02 per gallon in June 2022, gasoline prices are now 20 cents higher than last year.

Eleven states average $4 or more, including Colorado, Oregon and Arizona, according to AAA. The average price of regular gasoline in California is now $5.69 a gallon, up 49 cents over the last month.

A negative signal for gas prices is that the oil market continues to reach new highs.

U.S. crude oil rose as much as 1.7% to $92.33 a barrel on Monday. It is the first time since November 8, 2022 that oil has traded above $92. Brent crude oil, the international benchmark, hit a new 10-month high of $94.95 a barrel on Monday.

In addition to supply cuts, the oil market rally was also fueled by the catastrophic floods in Libya and easing recession fears in the US.

Citigroup warned clients on Monday that geopolitics could push oil prices above $100 a barrel “for a while.” However, the bank said “$90 prices appear unsustainable” and expects U.S. oil prices to fall below $70 a barrel by the second quarter of 2024.

Treasury Secretary Janet Yellen told CNBC on Monday that she expects energy prices to “stabilize,” noting that gas prices are no longer near their highs from last summer.

Asked whether the Biden administration was considering taking action, Yellen said the president had already released large amounts of emergency oil from the Strategic Petroleum Reserve.

“We are monitoring the situation very closely,” Yellen said.

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