Lower Inventory and Higher Demand Pump Oil Prices Past $90 a Barrel

Oil prices on Wednesday breached $90 a barrel, keeping gas prices near $3 per gallon as the U.S. petroleum inventory shrunk by about 1.5%.

Oil for February delivery increased 14 cents to $90.62 a barrel on the New York Mercantile Exchange, up from approximately $81 a barrel a month ago. Unsurprisingly, gas prices have surged as a result. Gas prices averaged $2.97 per gallon on Monday, the most recent day available, marking a 30-cent jump from Labor Day, according to an Energy Information Administration report Wednesday. That's the largest such jump in at least 20 years, the EIA noted.

The higher oil prices reflect tightened petroleum inventories and some growth in the U.S. economy, which is increasing demand. U.S. commercial crude inventories totaled 340.7 million barrels for the week that ended Dec. 17, down 5.3 million barrels from the previous week, according to the U.S. Energy Information Administration.

Meanwhile, the U.S. Commerce Department also on Wednesday revised its third-quarter gross domestic product growth figure to 2.6% from 2.5% last month.