As of 8:20 a.m. Eastern Time today, oil is trading at $96.65 per barrel, based on the Brent benchmark we’ll explain in a bit. That’s 23 cents above yesterday morning’s level and about $31 higher than where it stood a year ago.
Will oil prices go up?
No one can say for sure where oil prices will go next. Many forces shape the market—but at the core, it’s still about supply and demand. When risks like a potential recession or war ramp up, oil prices can change direction quickly.
How oil prices translate to gas pump prices
When you buy gas at the pump, you’re covering more than the cost of crude oil. You’re also paying for every step in the process, including refineries, wholesalers, taxes, and the markup your local gas station adds.
Even so, crude oil has the biggest influence on what you pay, often making up more than half the cost per gallon. When oil prices jump, gas prices usually climb right along with them. But when oil falls, gas prices often slip much more slowly—a pattern sometimes called “rockets and feathers.”
The role of the U.S. Strategic Petroleum Reserve
If an emergency hits, the U.S. keeps a backup supply of crude oil called the Strategic Petroleum Reserve. It’s mainly there to protect energy security during crises, such as sanctions, catastrophic storm damage, even war. It can also help cushion the blow when supply shocks send prices soaring.
It’s not meant to solve long-term problems. Instead, it provides quick relief for consumers and helps keep vital parts of the economy moving, like essential industries, emergency services, and public transit.
How oil and natural gas prices are linked
Oil and natural gas are two of the world’s primary energy sources. A big change in oil prices can affect natural gas by extension. For example, if oil prices increase, some industries may swap natural gas for some segments of their operations where possible, which which increases demand for natural gas.
Historical performance of oil
When looking at how oil performs, two main benchmarks stand out:
- Brent crude oil is the main global oil benchmark.
- West Texas Intermediate (WTI) is the main benchmark of North America.
Of the two, Brent gives a better picture of global oil performance because it prices a large share of the world’s traded crude. It’s also the go-to for tracking oil’s historical trends. In fact, even the U.S. Energy Information Administration now relies on Brent as its primary reference in its Annual Energy Outlook.
If you look at the Brent benchmark over several decades, oil has been far from stable. It has experienced sharp rises tied to wars and supply cuts, along with steep drops linked to global recessions and oversupply (called a “glut”). For example:
- The early 1970s delivered the first major oil shock when the Middle East slashed exports and placed an embargo on the U.S. and others during the Yom Kippur War.
- Prices fell in the mid-1980s due to lower demand and an influx of non-OPEC oil producers joining the market.
- Prices surged again in 2008 as global demand grew, but then crashed alongside the global financial crisis.
- During the 2020 COVID lockdown, oil demand plummeted like never before—pushing prices below $20 per barrel.
To sum up, oil’s historical performance has been anything but smooth. Again, it’s heavily influenced by wars, recessions, OPEC whims, shifting energy policies, and much more.
Energy coverage from Fortune
Looking to stay up-to-date regarding the latest energy developments? Check out our recent coverage:
- The Strait of Hormuz is splitting into U.S. and Iranian lanes as ship traffic picks up
- Gulf states are now looking to multi-billion-dollar investments in renewables
- Wall Street may have solved a nagging mystery in global oil markets
Frequently asked questions
How is the current price of oil per barrel actually determined?
The current price of oil per barrel depends largely on supply and demand, including news about potential future supply and demand (geopolitics, decisions made by OPEC+, etc.). In the U.S., prices also move based on how friendly an administration is to drilling, as it can affect future supply. For example, 2025 saw the Trump administration move to reopen more than 1.5 million acres in the Coastal Plain of the Arctic National Wildlife Refuge for oil and gas leasing, reversing the Biden administration’s policy of limiting oil drilling in the Arctic.
How often does the price of oil change during the day?
The price of oil updates constantly when the “futures” markets are open. A futures market is effectively an auction where people agree to buy or sell oil in the future. As long as people and companies are trading contracts, the oil price is changing.
How does U.S. shale oil production affect the current price of oil?
In short, shale is rock that contains oil and natural gas. Think of shale as energy yet to be tapped. The more shale the U.S. accesses, the more energy we’ll have—and the more easily oil prices can keep from spiking as much thanks to a greater supply.
How does the current price of oil impact inflation and the broader economy?
When oil is expensive, it tends to make everyday items cost more. This can be related to energy (your heating, gas utilities, etc.), but it’s also due to the logistics involved with making those items accessible to you. Shipping, for example, can affect the price of things at the grocery store, as it’s more expensive to get those products from warehouses and farms onto the shelf.