Oil prices continue to rise, and have surpassed their pre-pandemic levels : the rise continues for the fourth consecutive day as global energy demand increases sharply, causing energy shortages in developed countries.
Brent crude rose 0.3% to 83.86 a barrel, its highest level in more than three years, after gaining 1.5% on Monday.
US oil rose 0.2% to $80.65 a barrel, its highest level in seven years, after also gaining 1.5% in the previous session.
The rise was mainly due to energy shortages in the world’s major economies. Problems with gas and coal supplies are leading governments to turn to oil. “High gas and coal prices raise the prospect of increased reliance on oil for power generation,” says James Whistler, global head of energy derivatives at SSY in Singapore.
The switch from natural gas to oil for power generation could increase global demand for crude by 250,000 to 750,000 barrels per day, analysts say.
The energy price hikes, which are affecting the world’s biggest economies, are adding to inflationary pressures in recovering economies, such as Japan, where inflation was at its highest level in September.
Qatar, the world’s largest producer of liquefied natural gas (LNG), told customers on Monday it was not in a position to help bring down energy prices and supply more fuel to the market. “We are at the maximum, as far as we have given all our customers their due quantities,” said Qatari Energy Minister Saad al-Kaabi. “I am unhappy that gas prices are so high.
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