OIl up, not just because of inflation...Concerns about the global economic growth and covid-related lockdowns in China (which caused oil demand to crumble on their part), caused the price declines that were observed over the past year. It's probable that these vital global conditions are baked into the cake by now. Looking ahead we could see a longer term continued climb in OIL as inflation will render the US dollar effectively worthless as time progresses.
Volatility in 2023 could be caused by the (escalating) conflict in east europe, China going through their covid wave cycles and the FED cutting and raising rates to navigate the economy into and through a recession.
But the big denominator are the sanctions that are put on the trade for Russian oil, some of which have not even gone into effect yet. The International Energy Agency estimated that Russia’s oil production could drop by 1.4 million barrels per day in 2023 as a result of the sanctions. That means we are still consuming 1.4 million barrels per day, so the full effect of the sanctions have not yet been felt by the economy. It will take time before we can be fully dependend on alterative sources and methods to deal with the lack of this resource. Which means we should expect a horrendous winter or a multiple of winters to come somewhere in the coming years where mainly the poor will both economically and physically suffer even more than they already have from the ever rising oil prices caused by these sanctions all in the name of a so called moral virtue.
But hey, there is to many people on this planet anyway... (Said the rich)
