US crude oil prices surpassed $90 a barrel for the first time in more than seven years, according to official data on Thursday.
American benchmark West Texas Intermediate (WTI) spiked to $90.27 around 2 p.m. EDT. International benchmark Brent crude climbed above $91.
Both prices are the highest since Oct. 7, 2014 — right before the glut of supply in the global oil market caused prices to plummet for the next year and a half.
This time, however, the market is going through an inadequate supply against high demand as the global economy recovers from the coronavirus pandemic.
WTI fell into negative territory shortly in April 2020 due to record low demand, when the world was going through quarantine measures.
Although global demand has significantly increased, oil-producing countries have remained behind the curve, causing the most recent supply-demand imbalance.
The 23-members of the OPEC and its allies, dubbed OPEC+, agreed Wednesday to extend the current plan of increasing production by 400,000 barrels per day (bpd) through March, but that proved not enough to meet rising global demand.
OPEC+ cut its total crude oil production by 10 million bpd in April 2020 when the pandemic began.
Prices could hit $100 due to record high demand in 2023, Goldman Sachs warned in December.
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