Why did the price of #oil, after falling for 8 days, spike today? Spoiler: not because of a change in supply. "Russian oil continues to flow for the time being due to term deals and trades," @IEA said. Instead, energy traders reacted to IEA's prediction of a potential April drop.
IEA warned that "new business has all but dried up" for #Russian #oil as the world shuns the product in response to Russia's war against #Ukraine. If the war continues, and no on will buy Russian oil, "a shut-in of 3 mb/d of Russian oil supply" could start in April," @IEA said.
Price volatility has been the hallmark of oil for sometime; one key reason is the largely unregulated arena of oil futures trading. In the case of a war so closely tied to fossil fuels, you'd expect some volatility. But matters are made much worse due to this lack of regulation.
“The current crisis comes with major challenges for energy markets, but it also offers opportunities,” the IEA noted. “Indeed, today’s alignment of energy security and economic factors could well accelerate the transition away from oil.”
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