Jin Zhijun, Dean of the Institute of Energy at Peking University: High oil prices will not persist in the long term
Jin Zhijun: The viewpoint of the International Energy Agency is too extreme and overlooks the complexity and resilience of the current global energy landscape. Although short-term oil price fluctuations are inevitable, I believe excessively high oil prices will not persist for long, and the situation in the Middle East will not pose a long-term and significant threat to China’s energy security.
The Strait of Hormuz, as the strategic “throat” carrying about 20% of the global oil supply and liquefied natural gas transportation, has an undeniable strategic position. The current shipping disruptions in the Strait of Hormuz will trigger oil price fluctuations and push up international oil prices in the short term. However, this high oil price trend is bound to be temporary, as it does not align with the common interests of the world’s major economies and oil-producing countries.
When oil prices exceed $100 per barrel, excessively high prices will accelerate the replacement of fossil fuels by clean energy, ultimately harming the fundamental interests of oil-producing countries. Therefore, neither major oil-consuming countries nor oil-producing countries that rely on oil revenues hope for oil prices to remain at irrationally high levels for long.
In the long run, a range of $60 to $80 per barrel is a reasonable price interval that is acceptable to both oil producers and buyers, as well as the upstream and downstream sectors of the oil and gas industry. All parties will work together to guide oil prices back to a relatively rational range.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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