Oil's recent surge, supported by supply jitters, could add to U.S. inflation pressures.
Drivers could also see higher gas prices at the pump caused by crude's recent high and the approaching spring driving season.
The US will turn this years spring driving season to a all new spring cycling season as higher gas prices at the pump will reach the $5 a gallon..
The market could have trouble pushing oil prices much beyond current levels, we think the current run-up will be hard to maintain for much longer.
Reasons behind crude's recent surge were mostly short-term and as time goes on, most of them will fall by the wayside. Expectations that the Organization of Petroleum Exporting Countries could decide to cut production at a March 5 meeting gained strength over the weekend after comments from Iran, the cartel's second largest oil producer.
Oil minister Gholam Hossein Nozari said on Sunday that "it is normal for OPEC to cut its production in March every year," according to the AFP. "We will certainly need to examine the state of the market and also the global oil reserves and then decide," he said. OPEC, the cartel that controls about 40% of the world's oil production, refused to raise its oil production at a Feb. 1 meeting. Despite calls by some members for production cuts, sustained higher prices could thwart their efforts.
The only news for the bears is that if prices stay above $90 through the OPEC meeting, it is unlikely that OPEC would cut production.