$200 Oil Trifecta
Cold – Supply – Change
The weather, Mideast supply, climate change—these three forces could combine to give us oil costing $200 per barrel in the not-so-distant future. And the first two—weather and supply—could very well give us $100 oil in the immediate future.
Bank of America (BoA)
BoA points to the weather as the potential cause of oil costing $100 per barrel in the winter of 2022. According to Reuters, BoA Global Research recently posted an update:
“A much colder than normal winter could lead global oil demand to surge by 1 to 2 million barrels per day (mbpd), with the winter supply shortfall easily exceeding 2 mpbd in such a scenario, the bank said in a note dated Sept. 10.”
The BoA note continued:
“Downside risks include a new COVID-19 wave, taper tantrum, a China debt crisis, and the return of Iranian crude barrels. Having said all of that, winter weather risk is quickly becoming the most important driver of energy markets.” 
Weather experts point to an artic Polar Vortex threatening Europe and the United States.
“A new stratospheric Polar Vortex has now emerged over the North Pole and will continue to strengthen well into the Winter of 2021/2022. It will interact with a strong easterly wind anomaly high over the tropics. This interaction happens every few years and has actually brought colder winters to Europe and the United States in the past.”
So bundle up to stay warm. And stick some extra money aside to pay for higher gas and a spike in home heating.
OPEC—At It Again
Covid brought a decrease in the demand for oil. Responding, OPEC cut its output by 5.8 million barrels per day. Then, when world economies bounced back faster then expected, OPEC raised production 400,000 barrels per month.
The rise was not enough to tackle the rise in gasoline prices, so the Biden administration and the government of India called for a more rapid increase in production.
“OPEC members seem to not view rising prices as a critical problem for now,” energy analysts at risk consultancy Eurasia Group said in a research note.
So brace yourself: cold weather and a shrinking supply could give us $100 oil by year’s end.
And Then There’s This
Recently, western governments have banded together to limit the rise in the Earth’s temperature to less than 1.5 C degrees. How to achieve this goal? According to the journal Nature, the secret lies in keeping oil, gas, and coal in the ground:
“A report by scientific journal Nature earlier this week noted that 58 per cent of the world’s oil reserves, 59 per cent of fossil methane gas reserves and 89 per cent for coal reserves should remain in the ground . . . .”
Needless to say, this is not music to OPEC’s ears, and according to one Mideast energy minister:
“‘Recommending that we should no longer invest in new oil… I think that’s extremely dangerous,’ Mohammed bin Hamad Al-Rumhi, Oman’s energy minister, told a conference on clean energy transitions on Thursday.”
“‘My biggest fear, if we stop investing in the fossil fuel industry abruptly, is there will be energy starvation and the price of energy will just shoot (up),’ said Al-Rumhi, in charge of output in the Middle East’s largest producer outside of the Organization of Petroleum Exporting Countries.”
Cutting supply does not necessarily reduce demand. As noted above, prices will just “shoot up.”
So $200 oil might very well greet us at the pump in the not-so-distant future.
 https://www.reuters.com/business/energy/bofa-could-bring-forward-100-oil-target-event-cold-winter-2021-09-13/ (emphasis added)
 https://www.cnbc.com/2021/10/05/oil-prices-analysts-see-a-prolonged-rally-as-opec-sticks-to-its-plan.html | https://financialpost.com/commodities/energy/200-oil-possible-if-climate-change-policies-bring-on-energy-starvation-say-energy-insiders (emphasis added)