Recently, oil and natural gas prices have increased significantly, leading to a rise in power prices as energy shortages are impacting Asia and Europe. The International Energy Agency (IEA) has noted that high coal and gas prices, along with blackouts, are causing the power sector and energy-intensive industries to turn to oil for energy. These higher energy prices are also contributing to inflation and could potentially slow down economic recovery. The IEA has revised its global oil demand forecasts for next year, predicting a return to pre-pandemic levels and increasing demand forecasts for this year and 2022. An increase in demand during the previous quarter resulted in the largest depletion of oil product stocks in eight years, with storage levels in OECD countries at their lowest since early 2015. The IEA projected that the OPEC+ producer group will be pumping 700,000 bpd below the estimated demand for its crude in the fourth quarter of this year, indicating that demand will exceed supply until the end of 2021. The IEA also warned that spare production capacity from the group will decrease rapidly from 9 million bpd in the first quarter of 2021 to only 4 million bpd in the second quarter of 2022. This decline is focused in a few Middle East states, highlighting the need for increased investment to meet future demand. The report emphasized the importance of boosting spending on clean energy transitions promptly to avoid potential challenges in global energy markets. The IEA released its flagship annual energy outlook before an upcoming climate conference in Britain, stating that the current economic recovery heavily relies on unsustainable fossil fuels. It was stated on Wednesday that investment in renewable energy must increase threefold by the end of the decade in order to effectively combat climate change.