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Oil tops $90 as inflation kicks up

The price of oil hit $90 per barrel as crude supply tighten amid oil production cuts from Saudi Arabia and Russia creating a new headline in the fight to bring down inflation.

The price of oil moved over the $90 per barrel marker on Thursday as crude supplies tighten and as Saudi Arabia and Russia cut production. 

Crude is now at the highest level in 10-months. 

The climb has added to inflationary pressure. 

On Wednesday, the consumer price index rose 3.7% annually in August, more than expected. The jump was fueled by a surge in gas prices, which accounted for more than half of the increase last month, the Labor Department said in the report. In total, energy prices climbed 5.6% in August from the previous month, including a 10.6% jump in gas prices.

The producer price index, reported Thursday, which measures inflation at the wholesale level before it reaches consumers, climbed 0.7% in August from the previous month. On an annual basis, prices are up 1.6%

AMERICAN AIRLINES, SPIRIT LOWER GUIDANCE ON HIGHER FUEL COSTS

Meanwhile, the Russian and Saudi output reductions will result in a market deficit through the fourth quarter, the International Energy Agency said on Wednesday before a bearish U.S. inventories report prompted a slight pullback in prices.

West Texas Intermediate is up over 13.5% the last five days and now more than 31% the last quarter, while Brent Crude, the global benchmark, is now roughly 3.8% higher the last five days and almost 24% higher the last three months. 

OIL PRICES HIT NINE-MONTH HIGH AS SUPPLY CONCERNS MOUNT

Priyanka Sachdeva, senior market analyst at Phillip Nova, said supply fears are underpinning oil prices as producers "adamantly stick to restricted production".

SAUDI ARABIA EXTENDS OIL PRODUCTION CUTS TO END OF 2023, SENDING PRICES SOARING

The Organization of the Petroleum Exporting Countries (OPEC) recently issued updated forecasts of solid demand and also pointed to a 2023 supply deficit if production cuts are maintained.

Meanwhile, oil producers like Chevron, Hess, Exxon Mobile and Occidental Petroleum historically have benefited from higher oil prices. 

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FOX Business' Megan Henney and Reuters contributed to this report

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