What next for oil prices after hitting multiyear highs?

What next for oil prices after hitting multiyear highs?

What next for oil prices after hitting multiyear highs?

Oil is normally the king of the energy market. Where it leads others follow.

But in the past few weeks it has been usurped. Natural gas, which for decades was primarily priced off oil contracts, has become the leader of the energy pack, as the crunch in supplies globally has pumped up prices.

Oil has not been immune. Crude prices are starting to take off due to the spillover effects of the gas crunch, as some sectors look to replace gas with oil where it is economically feasible to do so.

Rystad, an energy consultancy, thinks oil demand could be boosted by as much as 1m barrels a day this winter through gas-to-oil switching for power generation and heating alone.

That is helping to support oil prices, with global marker Brent crude hitting its highest in three years last week at $83 a barrel, and US benchmark West Texas Intermediate reaching a seven-year high of $79.

With the Opec+ group declining to accelerate the return of production, and oil demand rebounding hard of its own accord as economies emerge from the pandemic, that is likely to keep support under crude. Will it regain the crown? Not yet,