The price of oil, at 92 dollars yesterday, is increasing and could quickly approach 100 dollars per barrel which is the average price observed over the whole of 2022.

What is the dynamic behind this price increase?
1- Demand is over 100 million barrels/day year to date. The path to carbon neutrality is not a history of the oil world.
2- Production is stretched to meet this demand.
3- The OPEC countries are increasing their production but Saudi Arabia is making the opposite move, creating tension on the market.
4- The International Energy Agency expects consumption to rise again in 2024 as global growth resumes.

Comments
1- Production margins are reduced and as long as Arabia maintains a bearish direction on its production, the price will have a bullish bias.
2- The contribution of energy to the inflation rate will become positive again, reversing what has been observed since the beginning of the year.
3- Inflation will gain in persistence further blurring the message of central banks.