After all the domestic economic drama at the end of last week — an 11th-hour debt ceiling deal, a blockbuster jobs report — there is now global economic drama over oil prices

OPEC+, the 23-country oil-producing alliance, had a pretty contentious meeting over the weekend.

Saudi Arabia and its allies pushed to cut global production as a way of boosting crude oil prices. Those prices have slumped after surging early last year.

In the end, Saudi Arabia, the group’s de facto leader, decided it’s going to take on that burden by itself — it’ll cut production by a million barrels a day starting in July. So what might that mean for energy and gas prices?

This time last year, crude oil futures were soaring toward $120 a barrel. Gas was running $4.85 a gallon on average, according to AAA. Since then, crude’s fallen by nearly half and the price at the pump is down more than a dollar. 

It’s simple supply and demand, per Peter McNally, global analyst at Third Bridge: Plenty of crude for sale, with Russia still getting its oil to market — cheap — in spite of sanctions. 

“Inventories have been rising since the third quarter of last year as supplies exceeded demand. The Saudis and their allies do need to cut production in order to balance the market,” he said.

“Balance the market” — in other words, try to boost oil prices or at least keep them from falling further.

Weak global energy demand, especially in China, is driving Saudi policy, McNally added. “About half the world’s oil demand growth for this year is expected to come out of China, and market participants are starting to feel a bit nervous about that, that those expectations won’t be met.”

Global recession fears are running high as well, said Mallory Newall at public opinion firm Ipsos.

“The perception right now for many people both in the U.S. and across the globe is that their country is in a recession,” Newall said. “And on a daily basis, they’re feeling the financial squeeze eating into their savings, leaning on credit.”

Even with Saudi Arabia cutting production, McNally predicts the impact on global crude prices and U.S. pump prices will be limited. 

“For the next six months or so, you’re looking at a situation where prices — at least on a year-on-year basis — are going to be lower,” he said.

That would be good for the overall inflation fight and good for U.S. consumers’ pocketbooks.