Gas prices hit a 2023 high on Thursday, renewing concerns that US inflation will reverse its downward trend.
The national average for a gallon of gas sat at $3.82, up $0.29 from one month ago, according to AAA.
Gasoline's upward price movement is largely due to US crude prices rallying 15% in July. West Texas Intermediate (CL=F) currently hovers above $81 per barrel.
"That $80 a barrel is really key area. We have to continue really to watch what's happening with oil," Marketgauge.com chief strategist Michele Schneider recently told Yahoo Finance Live.
The price of oil is often inversely correlated to the dollar and long-term Treasury yields, both of which have been on an upward trend. Supply concerns, however, are keeping crude prices elevated.
"Regardless of the yields going up today, or the dollar going up, we know that there are factors in commodities that ignore all of that when we come into a real supply-demand situation."
On Thursday, Saudi Arabia said it will extend its unilateral production cut of 1 million barrels of oil a day through the end of September in its effort to maintain a floor on prices.
The reduction was announced earlier this year after OPEC+ said it was extending its production cuts through next year.
Extreme heat in some areas of the US has also impacted gasoline supply.
"Like people, refineries do not like a heat index of 110-115. They must cut their production rates and that impacts gasoline and diesel supply. In addition, several refineries have had unscheduled outages limiting supply," Andy Lipow of Lipow Oil Associates recently told Yahoo Finance.
The interruptions could get worse if the US experiences a major hurricane this season.
Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on Twitter at @ines_ferre.
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