"If energy stocks were all that great, the ASX200 Energy index...

"If energy stocks were all that great, the ASX200 Energy index would not still be 20pc below it’s preCOVID highs when Oil price has already well exceeded above its 5 year highs , the XLE is also still 7pc below its June18 highs."

The energy sector still hasn't played out yet. Part of it was to do with ESG pressure on funds not investing into energy stocks.

"The reason why energy stocks enjoyed this short term gains is because there has been a sectoral shift in fund flows from tech to energy ie from growth to value in recent months due to the prospect of higher rates ahead."

Yes and because energy stocks are receiving substantially higher cash flows due to prices increasing, with P/E's in the single digits. A no brainer investment compared to tech which is highly overvalued.

"Fund flows is a key determinant but we have to consider if this move is just transitory as funds seek safe havens reducing positions in tech moving into value. The next thing to consider is if this rise in oil price is sustainable for longer without tilting economies into recession. Should there be a decline in demand or rather a normalisation in demand, oil producers would be first to increase supply to reduce price. So if energy stocks can’t even exceed pre COVID highs when oil is approaching $100, will it ever and will it even remain at current levels for long?

Transitory? Safe Haven? Decline in demand? Normalisation in demand? Why would there be a decline in demand when we still can't fly overseas? Demand is only going higher particularly once Covid-19 is normalised.

LONDON, Feb 1 (Reuters) - OPEC+ will likely stick to existing policies of moderate output increases on Wednesday, five sources from the producers' group said even as it expects demand to rise to new peaks this year and as oil prices trade near their highest since 2014.The group, which comprises of the Organization of the Petroleum Exporting Countries and allies led by Russia and produces over 40% of global supply, has faced pressure from top consumers such as the United States and India to pump more to help the economic recovery from the pandemic.Report adBut OPEC+ has refused to adhere to speedier increases arguing that the world is facing an energy shortage due to poorly calculated energy transitions to greener fuels by consuming nations.Several OPEC members have struggled to pump even in line with their quotas due to under-investments of the past few years.Five OPEC+ sources told Reuters on Tuesday they expected the ministers to agree to go ahead with a planned increase of 400,000 barrels per day in March, despite high oil prices.

Global oil demand to surpass pre-pandemic levels in 2022 as omicron fears subside: IEAHIGHLIGHTSIEA raises 2021, 2022 demand forecasts by 200,000 b/dGlobal oil demand to average 99.7 million b/d in 2022Cautions over potential for volatile oil market this year AuthorRobert Perkins EditorKshitiz Goliya CommodityOilGlobal oil demand is set to surpass pre-pandemic levels in 2022 as fears over the latest coronavirus wave subside, creating the potential for another "volatile" year of oil prices, the International Energy Agency said Jan. 19.Not registered?Receive daily email alerts, subscriber notes & personalize your experience.Register Now In its monthly oil market report, the IEA raised its demand estimates by 200,000 b/d for both 2021 and 2022, to reflect clear signs that impact on economic activity and oil demand from the omicron variant remained "relatively subdued."World oil demand was seen rising by 5.5 million b/d in 2021 and by 3.3 million b/d in 2022, the IEA said, surpassing its pre-pandemic levels by 200,000 b/d to 99.7 million b/d.During the fourth quarter of 2021, the IEA said global demand "defied expectations" rising by 1.1 million b/d to 99 million b/d, an upward revision of 345,000 b/d compared to its previous report."If demand continues to grow strongly or supply disappoints, the low level of stocks and shrinking spare capacity mean that oil markets could be in for another volatile year in 2022." the IEA said.The IEA's latest report comes as oil prices hit fresh seven-year highs at over $88/b, supported by a growing consensus that oil demand and supply balances are tightening this year, with some market watchers predicting Brent futures will hit $100/b later in the year.Spare capacityOn the supply side, the IEA said it now sees OPEC+ spare capacity shrinking to 2.6 million b/d later this year from around 5 million b/d currently if the producer group continues to unwind its supply cuts and Iran remains under sanctions.The IEA said it still expects OPEC+ to pump 1.5 million b/d above the call for its crude in first quarter of 2022, if it continues to unwind its COVID cuts. By the second quarter, the IEA sees OPEC+ crude output rising to 1.7 million b/d above the call.The IEA trimmed its forecast for non-OPEC oil supply by 100,000 b/d to 66.5 million b/d, however, to reflect constraints on Russian oil production growth capacity.Russia oil supplies for 2022 have been revised down by 130,000 b/d, with crude oil capacity pegged around 10.2 million b/d, to reflect the latest official targets, the IEA said.Expected non-OPEC oil supply growth in 2022 was unchanged since last month's report, however, at 1.8 million b/d.US oil output is forecast to rise by 1 million b/d on average, to 17.7 million b/d, as operators respond to higher prices. Additionally, Ecuador, Libya and Nigeria were already ramping back up.Overall, world oil supply in 2022 has the potential for a Saudi-driven gain of 6.2 million b/d if OPEC+ fully unwinds its cuts, the IEA estimated, compared with a 1.5 million b/d rise in 2021.Sharp stock drawsOn stocks, the IEA said OECD industry stocks declined to seven-year lows in November, falling 6.1 million barrels month on month and 354 million barrels year on year, to 2.76 billion barrels."Data suggest that 2022 is starting off with global oil inventories well below pre-pandemic levels. A growing discrepancy between observed and calculated stock changes suggests demand could be higher or supply lower than reported or assumed," the IEA said.Preliminary data for December showed that OECD stocks plunged by a further 45.2 million barrels, 35% more than the normal seasonal decline for the month.