US oil prices rose sharply on Tuesday, climbing above $81 a barrel for the first time in two months.
Crude closed at $81.22 a barrel, up nearly 4% on the day. It’s the highest level for oil since November 11.
The latest gains unwind a good chunk of the relief experienced in energy markets in recent weeks.
Prices at the pump have also paused their recent retreat. The national average stands at $3.30 a gallon, up by a penny from a week ago, according to AAA.
Government forecasters revised higher their gas price forecast on Tuesday.
The US Energy Information Administration now projects gasoline prices will average $3.06 a gallon in 2022. That’s up from the EIA’s early December forecast of $2.88 a gallon.
Oil prices began tumbling in early November on rumors that the White House would intervene to cool off energy markets. President Joe Biden announced the largest-ever release of barrels from the Strategic Petroleum Reserve on November 23.
Crude kept sliding on fears about the Omicron coronavirus variant, sinking to $65.75 a barrel on December 1.
But oil closed on Tuesday about 24% above the recent lows.