For the first time since April, the price of oil has gone below $100 a barrel, because of global shocks reducing the demand for the commodity.

According to Oilprice.com WTI Crude oil has dipped to US$99.64 (Brent) and US$96.30 (WTI) from highs in February of US$105.79 (Brent) and US$100.54 (WTI); highs not seen since 2014.

But former minister of energy Kevin Ramnarine said that the price will not stay below $100 for very long, as the colder months will see a spike in demand for oil and gas to keep temperate countries warm.

Ramnarine told Newsday that Trinidad and Tobago's role in the oil, gas and petrochemical sectors may soon be greater than it was before which means that it will benefit from higher prices and higher demand as countries around the world face energy crises and possible recessions.

Covid19, Russia, high prices affect demand

Ramnarine said the reduction of demand because of high fuel prices, China's strict rules and regulations on covid19, the Russian/Ukrainian war and concerns over the state of European economies have all contributed to the overall price of oil going down. He said the ripple effect the high price of oil earlier in the year had on other commodities such as fuel and transport caused demand to dwindle as consumers began managing and reducing costs.

'There comes a point where an increase in price leads to something called 'demand destruction' where consumers makes a decision that they are not going to consume as much as they used to. That demand destruction is beginning to set in around the world.'

He added that China's hard-nosed stance on covid19 has also negatively affected that country's ability to recover. He said China has one of the more stringent policies in the world.

'In China, entire cities are shut down because of a few cases,' he said.

'So because of that approach China's economy has not yet returned to pre-covid state and their demand for oil has not yet returned to pre-covid levels.'

Last week a VOA news report said millions of people were sent back inside and businesses forced to shutter their doors across China after clusters of cases sparked restrictions. Chinese health authorities reported more than 300 infections in Xian and new clusters in Shanghai, Beijing and other provinces.

China's low demand coupled with the Russian/Ukrainian war's effect on European economies has also weighted down the price of oil.

'There is an increasing fear in the marketplace that the economies of the world and Europe in particular are in serious trouble,' he said.

'The Euro zone has some of the largest economies in the world, with Germany, France and other countries being considerably large.

'There is a concern that Europe could dip into recession and the United States (is) also showing similar signs. I am not saying that it will happen, I am saying that there is a fear of it happening. That fear is being reflected in the market.'

Winter is coming

Ramnarine however assured that the colder months when Europe and the US will need heat will s