A variety of explanations were offered for the price rises. Coal prices shot up largely because of Indonesia’s imposition of a temporary export ban. Low levels of stocks and the threat of power cuts lay behind that measure (coal accounts for 66 % of power generation in Indonesia, according to BP figures). And the fact that Indonesia is the world’ largest coal exporter (with a global share of 41 %, compared to 20 % for Australia and 18 % for Russia), meant the measure was bound to lead to shortages among Asia’s biggest consumers of coal – China, India, South Korea and Japan. The result was a price rise also affecting other regions – in China, coal prices from the beginning of 2022 climbed 19 % (to $157 a tonne) and in Europe the rise was 26 % (to $147 a tonne).

    Oil prices at the beginning of the year were supposed to remain calm on the basis of a surplus on world markets. Countries in the OPEC+ agreement from August increased their upper production limit every month by 400,000 barrels per day and in the United States, oil production at the end of 2021 reached 11.8 million bpd — the highest level over the past year and a half, according to data issued by the Energy Information Administration (EIA) of the Department of Energy.

    At the same time, the EIA’s January forecast put the world-wide rise in supply for 2022 at 6 million bpd, while the rise in demand, on the strength of a high statistical baseline, would amount to only 3.6 million bpd, according to the EIA’s January forecast. The risks of a surplus, however, receded in the light of rocket attacks on the United Arab Emirates, OPEC’s third largest producer.

    Gas price rises were spurred upward by reduced levels of stocks in underground storage sites – on 25^th January 2021, these were filled to 55 % of capacity, while a year on the figure stood at only 41 %, according to Gas Infrastructure Europe. And for that reason, investors can take no heart from a reverse trend on the liquefied natural gas (LNG) market – in the first three quarters of 2021, Europe reduced its imports of LNG by 17 % year-on-year (to 78 billion cu.m. in regasified form), while in the fourth quarter a 36 % rise in imports was recorded (to 33 billion cu.m., according to Refinitiv data).

    Although the most acute phase of the energy crisis is behind us, commodities markets continue to react in sensitive fashion to any background of “bullish” news. Will this trend change in spring, when the cold weather will be over and the U.S. Federal Reserve systems proceeds with a rise in interest rates?

    But that remains an open question.