Paradoxical though if may seem, experts identified the energy transition as one of the key factors behind the increase.
Against a background of economic recovery as Covid restrictions eased, demand for oil and gas rose this year considerably more quickly than had been expected.
And what is more, investors operating amid the hype around cutbacks in hydrocarbon use and a transition to renewable energy sources sharply reduced their investments in the oil and gas sector. And as a result, the number of sites for drilling new wells fell sharply, along with hydrocarbon production.
And then the weather got in the way.
A cold 2020-2021 winter and a hot summer left underground gas storage sites in Europe filled only to 60 % of capacity. That propelled gas prices to $900-1,000 per 1,000 cu.m. According to data from ICE Futures, forward gas prices right up to next February will remain above $1,000 per 1,000 cu.m. And all that prompted buyers to start shifting to cheaper oil – thereby pushing up the oil price.
That factor pushed up demand for oil by 500,000 barrels per day for the coming winter, according to oil traders Vitol. Facts Global Energy issued a similar forecast – their analysts noted that in Asia and other regions, companies were on the lookout for less expensive alternatives to the soaring price of gas.
Forecasts issued by OPEC indicate that a partial shift by companies from gas to oil will boost world-wide oil demand by 370,000 barrels per day over the next two quarters.
Two further factors behind rising oil prices were the resumption of intercontinental air travel and disruptions in coal supplies in Indonesia and Australia.