Every day sees new records being set in energy price inflation, both in the U.S. and Europe. It is described by CNBC as “an unusual coincidence of much higher oil, natural gas and coal prices, combined with other rising commodities and supply chain disruptions.” This “unusual coincidence” is creating a “perfect storm,” they fret.
For example, U.S. oil prices have already gone up more than 65% this year to date, and natural gas prices have increased over 112% in the same period. But that’s nothing compared to Europe. “Citigroup forecasts a winter price shock that could see natural gas prices in Europe average over $30 per 1 million British thermal unit [Btu] in the fourth quarter and over $32 in Asia,” CNBC reports. “But Citi energy analysts also say if there is a very cold winter that could spike as high as $100/mmBtus, the equivalent of about a $580 barrel of oil. By comparison, U.S. natural gas futures are currently trading at $5.25 per mmBtu.”
