Crude oil hits $90 per barrel for first time since 2014

Crude oil prices reached $90 per barrel for the first time since 2014 on Thursday afternoon.  

West Texas Intermediate (WTI) futures, the benchmark used in the U.S., rose sharply early Thursday afternoon, peaking at $90.28 at 3:24 p.m. ET and falling slightly to $89.98 around 4:15 p.m. ET. The price later returned to $90.38 around 4:30 p.m. ET.

The increase is likely, although not guaranteed, to result in an increase in gas prices.

A surge in prices amid broader inflation last year took a political toll on President Biden, although the determinants of prices include a multitude of factors outside presidents’ control. In December, after weeks of increases, Biden touted declines and said the White House would ensure consumers were not “gouged for gas.” The White House also announced an investigation into whether energy companies had engaged in illegal activity.

A number of factors are causing anxiety in the market, including ongoing tensions between Russia and Ukraine, as well as a cold snap in Texas, hurting production in the Permian Basin.

Middle Eastern tensions may also be a factor, with the United Arab Emirates, an OPEC member, claiming this week that it had intercepted and destroyed three hostile drones. While the UAE is part of a coalition opposing Iran-backed Houthi rebels in Yemen, no one has yet claimed credit.

Demand plunged during the early part of the pandemic in the spring of 2020, but since then, the demand has increased but supply has not kept pace.

After surging 50 percent in 2021, WTI has increased nearly 20 percent in 2022 thus far. OPEC+, a coalition of OPEC and its allies, announced Wednesday that it would stick to its scheduled production increase of 400,000 barrels a day in March. International leaders, including President Biden, had previously pressured the organization to increase production.

The milestone comes a week after the international oil benchmark, brent crude, also surpassed $90 for the first time since 2014.