The world is in the grip of an oil price shock. In just a few months, prices have risen from US$65 a barrel to over $130, causing fuel costs to surge, inflationary pressure to rise and consumer tempers to flare. Even before Russia’s invasion of Ukraine, prices were climbing rapidly because of roaring demand and limited supply growth.

Price shocks aren’t new. Viewed historically, they are an integral part of oil market dynamics, not anomalies. They have occurred since the birth of the industry.

Many factors can trigger oil price shocks. They include large shifts in either demand or supply anywhere in the world, since oil is a global commodity. Shocks can also result from war and revolution; periods of rapid economic growth in major importing nations; and domestic problems in supplier countries, such as political conflict or lack of investment in the oil industry. Overall, the worst spikes have combined two or more of these factors – and that’s the situation today.

50 years of ups and downs

Global oil production began in the mid-1800s and grew rapidly in the first half of the 20th century. For much of that time, oil majors – companies like Chevron, Amoco and Mobil that were created after the Supreme Court ordered the breakup of Standard Oil in 1911 – operated effectively as a cartel, maintaining production at levels that kept oil abundant and cheap to encourage its consumption.

This ended when Iran, Iraq, Kuwait, Saudi Arabia and Venezuela formed the Organization of Petroleum Exporting Countries in 1960, nationalizing their oil reserves and gaining real supply power. Over the following decades, other nations in the Middle East, Asia, Africa and Latin America joined – some temporarily, others permanently.

In 1973, Arab members of OPEC cut their oil production when Western countries supported Israel in the Yom Kippur War with Egypt and Syria. World oil prices shot up fourfold, from an average of $2.90 per barrel to $11.65.

In response, government leaders in wealthy countries introduced policies to stabilize oil supplies. These included finding more oil, investing in energy research and development, and creating strategic oil reserves that governments could use to mitigate future price shocks.

But six years later, oil prices more than doubled again when Iran’s revolution halted that country’s output. Between mid-1979 and mid-1980, oil rose from $13 per barrel to $34. Over the next several years, a combination of economic recession, replacing oil with natural gas for heating and industry, and shifting to smaller vehicles helped to mitigate oil demand and prices.

The next major shock came in 1990 when Iraq invaded Kuwait. The United Nations imposed an embargo on trade with Iraq and Kuwait, which raised oil prices from $15 per barrel in July 1990 to $42 in October. U.S. and coalition troops moved into Kuwait and defeated the Iraqi army in just a few months. During the campaign, Saudi Arabia increased oil production by more than 3 million barrels per day, roughly the amount previously supplied by Iraq, to help dampen the increase and shorten the period of higher prices.

More disruptive price shocks occurred in 2005-2008 and 2010-2014. The first resulted from increased demand generated by economic growth in China and India. At that time, OPEC was unable to expand production due to long-term lack of investment.

The second shock reflected the impacts of Arab Spring pro-democracy protests in the Middle East and North Africa, combined with conflict in Iraq and international sanctions that Western nations placed on Iran to slow its nuclear weapons program. Together, these events pushed oil prices above $100 per barrel for a four-year stretch – the longest such period on record. Relief finally came via a flood of new oil from shale production in the U.S..

A pefect storm in 2022

Today, multiple factors are raising oil prices. There are three key elements:

• Oil demand has grown more rapidly than expected in recent months as countries emerged from pandemic lockdowns.

• OPEC+, a loose partnership between OPEC and Russia, has not raised production at a commensurate level, and neither have U.S. shale oil companies.

• Countries have drawn on stocks of oil and fuel to fill the supply gap, reducing this emergency cushion to low levels.

These developments have made oil traders worry about looming scarcity. In response, they have bid oil prices up. It’s worth noting that while consumers often blame oil companies (and politicians) for high oil prices, these prices are set by commodity traders in venues such as the New York, London and Singapore stock exchanges.

Against this backdrop, Russia attacked Ukraine on Feb. 24, 2022. Traders saw the potential for sanctions on Russian oil and gas exports and bid energy prices even higher.

Unexpected factors also have emerged. Major oil companies including Shell, BP and ExxonMobil are ending their operations in Russia. Spot market buyers have rejected seaborne Russian crude, probably for fear of sanctions.

And on March 8, the U.S. and U.K. governments announced bans on imports of Russian oil. Neither country is a major Russian buyer, but their actions set a precedent that some analysts and traders fear could lead to escalation, with Russia reducing or eliminating exports to U.S. allies.

In my view, this set of conditions is unprecedented. It reflects not just increased complexity in the global market, but also an imperative for energy firms – which already are under pressure from shareholder climate activists – to avoid further reputational damage and leave one of the most oil-rich countries in the world. Some companies, such as BP, are abandoning assets worth tens of billions of dollars.

What could ease this shock?

As I see it, the key players that can help curtail this price shock are OPEC – mainly, Saudi Arabia – and the U.S. For these entities, holding back oil supply is a choice. However, there’s no evidence yet that they are likely to change their positions.

Restoring the Iran nuclear deal and lifting sanctions on Iranian oil would add oil to the market, though not enough to greatly reduce prices. More output from smaller producers, such as Guyana, Norway, Brazil and Venezuela, would also help. But even combined, these countries can’t match what the Saudis or the U.S. could do to increase supply.

All of these uncertainties make history only a partial guide to this oil shock. Currently there is no way to know how long the factors driving it will last, or whether prices will go higher. This isn’t much comfort to consumers facing higher fuel costs around the world.

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Scott L. Montgomery, Lecturer, Jackson School of International Studies, University of Washington

This article is republished from The Conversation under a Creative Commons license. Read the original article.

People typically think of food as calories, energy and sustenance. However, the latest evidence suggests that food also “talks” to our genome, which is the genetic blueprint that directs the way the body functions down to the cellular level.

This communication between food and genes may affect your health, physiology and longevity. The idea that food delivers important messages to an animal’s genome is the focus of a field known as nutrigenomics. This is a discipline still in its infancy, and many questions remain cloaked in mystery. Yet already, we researchers have learned a great deal about how food components affect the genome.

I am a molecular biologist who researches the interactions among food, genes and brains in the effort to better understand how food messages affect our biology. The efforts of scientists to decipher this transmission of information could one day result in healthier and happier lives for all of us. But until then, nutrigenomics has unmasked at least one important fact: Our relationship with food is far more intimate than we ever imagined.

The interaction of food and genes

If the idea that food can drive biological processes by interacting with the genome sounds astonishing, one need look no further than a beehive to find a proven and perfect example of how this happens. Worker bees labor nonstop, are sterile and live only a few weeks. The queen bee, sitting deep inside the hive, has a life span that lasts for years and a fecundity so potent she gives birth to an entire colony.

And yet, worker and queen bees are genetically identical organisms. They become two different life forms because of the food they eat. The queen bee feasts on royal jelly; worker bees feed on nectar and pollen. Both foods provide energy, but royal jelly has an extra feature: its nutrients can unlock the genetic instructions to create the anatomy and physiology of a queen bee.

So how is food translated into biological instructions? Remember that food is composed of macronutrients. These include carbohydrates – or sugars – proteins and fat. Food also contains micronutrients such as vitamins and minerals. These compounds and their breakdown products can trigger genetic switches that reside in the genome.

Like the switches that control the intensity of the light in your house, genetic switches determine how much of a certain gene product is produced. Royal jelly, for instance, contains compounds that activate genetic controllers to form the queen’s organs and sustain her reproductive ability. In humans and mice, byproducts of the amino acid methionine, which are abundant in meat and fish, are known to influence genetic dials that are important for cell growth and division. And vitamin C plays a role in keeping us healthy by protecting the genome from oxidative damage; it also promotes the function of cellular pathways that can repair the genome if it does get damaged.

Depending on the type of nutritional information, the genetic controls activated and the cell that receives them, the messages in food can influence wellness, disease risk and even life span. But it’s important to note that to date, most of these studies have been conducted in animal models, like bees.

Interestingly, the ability of nutrients to alter the flow of genetic information can span across generations. Studies show that in humans and animals, the diet of grandparents influences the activity of genetic switches and the disease risk and mortality of grandchildren.

Cause and effect

One interesting aspect of thinking of food as a type of biological information is that it gives new meaning to the idea of a food chain. Indeed, if our bodies are influenced by what we have eaten – down to a molecular level – then what the food we consume “ate” also could affect our genome. For example, compared to milk from grass-fed cows, the milk from grain-fed cattle has different amounts and types of fatty acids and vitamins C and A . So when humans drink these different types of milk, their cells also receive different nutritional messages.

Similarly, a human mother’s diet changes the levels of fatty acids as well as vitamins such as B-6, B-12 and folate that are found in her breast milk. This could alter the type of nutritional messages reaching the baby’s own genetic switches, although whether or not this has an effect on the child’s development is, at the moment, unknown.

And, maybe unbeknownst to us, we too are part of this food chain. The food we eat doesn’t tinker with just the genetic switches in our cells, but also with those of the microorganisms living in our guts, skin and mucosa. One striking example: In mice, the breakdown of short-chain fatty acids by gut bacteria alters the levels of serotonin, a brain chemical messenger that regulates mood, anxiety and depression, among other processes.

Food additives and packaging

Added ingredients in food can also alter the flow of genetic information inside cells. Breads and cereals are enriched with folate to prevent birth defects caused by deficiencies of this nutrient. But some scientists hypothesize that high levels of folate in the absence of other naturally occurring micronutrients such as vitamin B-12 could contribute to the higher incidence of colon cancer in Western countries, possibly by affecting the genetic pathways that control growth.

This could also be true with chemicals found in food packaging. Bisphenol A, or BPA, a compound found in plastic, turns on genetic dials in mammals that are critical to development, growth and fertility. For example, some researchers suspect that, in both humans and animal models, BPA influences the age of sexual differentiation and decreases fertility by making genetic switches more likely to turn on.

All of these examples point to the possibility that the genetic information in food could arise not just from its molecular composition – the amino acids, vitamins and the like – but also from the agricultural, environmental and economic policies of a country, or the lack of them.

Scientists have only recently begun decoding these genetic food messages and their role in health and disease. We researchers still don’t know precisely how nutrients act on genetic switches, what their rules of communication are and how the diets of past generations influence their progeny. Many of these studies have so far been done only in animal models, and much remains to be worked out about what the interactions between food and genes mean for humans.

What is clear though, is that unraveling the mysteries of nutrigenomics is likely to empower both present and future societies and generations.

Monica Dus, Assistant Professor of Molecular, Cellular, and Developmental Biology, University of Michigan

This article is republished from The Conversation under a Creative Commons license. Read the original article.