Why Oil Prices are High: OPEC+ Keeps a Tight Grip

Ever wondered why oil prices are going up? It's because OPEC+ has decided to hold off on increasing oil production. This group, led by Saudi Arabia and Russia, has voluntarily agreed to cut 2. 2 million barrels of oil per day until March 2025. That's like having a bunch of bakeries deciding to make fewer loaves of bread, so the price of each loaf goes up. But why are they doing this? OPEC+ says it wants to support market stability. This means they want to keep the price of oil at a certain level to make sure it's profitable for them. The problem is, demand for oil in places like China is dropping, and the U. S. is producing lots of oil. So, it's like they're trying to sell fewer loaves of bread when people are eating less bread and other bakeries are making more. Now, what happens after March 2025? Well, these cuts will slowly be taken away until September 2026. But there's also another set of cuts, 1. 65 million barrels per day, that will stay until December 2026. It's like they're slowly taking away the limits on bread, but still keeping some in place for a while. The International Energy Agency in Paris has warned that even with these cuts, the world will have more oil than it needs next year. It's like having too many loaves of bread, even when bakeries are making fewer. So, why should you care? Well, when oil prices go up, it can affect the cost of driving your car, heating your home, and even the price of goods you buy. It's like when the price of bread goes up, everything else that uses bread will cost more too.