Energy prices have been stable this year, but the ongoing Middle East turmoil could still cause disruptions. Learn how higher prices are going to affect your business and what you can do to combat this.
How do wars affect the energy market?
The World Bank is concerned about the impact of the ongoing turbulence in the Middle East on global trade. Their recent report on Commodity Markets highlights the concern.
The report states that the global economy is more equipped to deal with issues related to oil supply. However, it also highlights the potential risks associated with the Middle East conflict. Prior disruptions such as the Russian invasion of Ukraine compound global trade stability.
If the Middle East gets worse, commodity markets could change a lot, according to the report. This is similar to what happened during the Russian-Ukraine conflict last winter. During that time, oil prices reached a record high of $122 per barrel.
The World Bank expects oil prices to be around $90 per barrel this quarter. Next year, prices may become more unstable and drop to about $81 per barrel because of global economic slowdown.
However, should the Middle East conflict intensify, commodity prices may experience heightened volatility. The report examines various scenarios based on 1970s data, depending on the impact on global oil supplies.
A small disruption in global oil supply could cause oil prices to fluctuate. The disruption would result in a decrease of 500,000 to 2 million barrels per day. As a result, oil prices could range from $76.5 to $83.9 per barrel.
If oil supplies decrease by 3-5 million barrels per day, prices could fluctuate between $89.7 and $99.5 per barrel. Observers witnessed this during the Iraq war in 2003.
In a "large disruption" scenario, akin to the situation during the Arab oil embargo in 1973, a reduction of six to eight million barrels per day would result in extreme price volatility, surging between $115 and $129.2 per barrel.
What can you do to combat this?
Businesses want reliable and affordable energy solutions to protect their operations in unpredictable energy markets.
This is where our free solar solutions come into play. Using solar energy helps businesses rely less on costly traditional energy sources affected by global conflicts.
Our solar solutions will provide stable energy, helping businesses reduce energy costs.
Solar energy has a reputation for its predictability and its consistent ability to generate electricity, regardless of external market forces. This helps businesses by keeping prices stable and protecting them from price changes in oil and gas markets during conflicts.
Moreover, adopting solar power demonstrates a commitment to sustainability and environmental responsibility, aligning with corporate social responsibility goals. It also showcases resilience and forward-thinking, allowing businesses to thrive in an ever-changing energy landscape. Our solar solutions help businesses save money, be more competitive, and contribute to a greener world.
Want to see how much your business can save on energy with solar? Use our free calculator today to get an instant solar quotation and an estimate of how much your business will save on its electricity bills. Use our calculator here.
What is free solar?
We know the term free solar might seem too good to be true but for a lot of businesses, it is not. At Resolve Net Zero we offer a free solar product called a Power Purchase Agreement (PPA), this essentially allows you all the benefits of solar without the costs. This includes Free installation, Free maintenance, and Free management of a solar array. With our PPA offering, you can purchase the system at a discounted rate after 6 years. After 25 years you will be gifted the solar array completely free of charge.
Interested? Why not get in touch today to see if you qualify.
If you're ready to improve your energy efficiency whilst driving down your electricity bills, then solar panels could be a good option for your business. Request a free solar quote now and start reducing your carbon footprint and energy bills today.
