Study on the relation between oil, natural gas and coal prices

2, oil, natural gas, coal unit heat price ratio analysis

We compare the average price per unit heat of oil, natural gas and coal and their price ratios in 2020-2022, as shown in Table 1 and Figure 2. First, spot prices for oil, gas and coal have soared, especially for natural gas. Secondly, from the point of view of unit heat price, after converting oil and natural gas according to the heat of benchmark coal, the ratio of unit heat price of oil and benchmark coal is declining, while the ratio of natural gas and benchmark coal is rising significantly. The average unit heat price of oil in 2020 is significantly higher than that of natural gas and coal, while the average unit heat price of natural gas in 2021 and 2022 is higher than that of oil and coal. From the point of view of the growth rate of unit heat price, natural gas has the largest growth rate, and the growth rate has the largest change, followed by coal, and finally oil.

Considering the soaring price of natural gas during the European gas shortage in 2021, the ratio of unit heat prices of oil, natural gas and coal before and after August 2021 is further compared, as shown in Figure 3. Taking the unit heat price of coal as the benchmark for comparison, the ratio of unit heat price of natural gas to coal has significantly changed around August 2021, increasing from 1.50 to 3.16, with a change range of 110.67%; The ratio of unit heat price of petroleum and coal decreased from 2.66 to 1.73, with a change range of -34.96%. This shows that the soaring price of natural gas in Europe in 2021 has changed the ratio relationship of unit heat prices of oil, natural gas, coal and other energy sources, and also has an impact on the structural changes of the energy market.

3, oil, natural gas, coal unit heat price growth analysis

The growth rate of unit heat prices of oil, natural gas and coal during 2020-2022 is shown in Figure 4. The growth rate of oil and coal unit heat prices remained stable overall, but the growth rate of oil unit heat showed large fluctuations in March 2020, due to the COVID-19 outbreak and the breakdown of the OPEC production reduction alliance. The growth rate of natural gas unit heat price is less stable, more volatile than oil and coal, and the frequency of large fluctuations is also higher.

Compared with the other two energy sources, coal has the lowest unit heat price and relatively stable growth rate. In terms of chemical composition, coal is almost entirely composed of carbon atoms, which is more suitable for use as a molecular skeleton of chemical synthetic materials from the perspective of atomic transformation, while oil and natural gas contain more hydrogen atoms and are more suitable for use as fuel components. Due to the different hydrogen content, the energy density of oil and gas is significantly higher than that of coal, which is about three times that of the latter. On the whole, oil and natural gas are more suitable as fuels, and coal is more suitable as chemical raw materials. From the downstream use of oil and gas, the proportion of fuel consumption is more than 80%, and the proportion of materials is only 15%-20%. Therefore, the energy attribute determines the listed price of oil, natural gas and coal, and also doomed coal to have a greater advantage in price.

4, oil, natural gas, coal unit heat price difference analysis

The price difference between oil, gas and coal per unit heat in 2020-2022 is shown in Figure 5. Among them, the price difference of oil and coal unit heat is measured by "oil unit heat price - coal unit heat price"; The price difference between natural gas and coal per unit heat is measured as "natural gas per unit heat price - coal per unit heat price". The price difference between oil and coal has mostly remained at 0.1-0.2 USD /5500 kcal, and the price difference has fallen all the way in early 2020, because the collapse in oil prices caused by the sharp decline in oil demand has driven the price of oil unit heat below 0.1 USD /5500 kcal. The price difference between natural gas and coal remained within $0.20/5,500 kcal until August 2021, but after August 2021, the level of the spread soared, reaching an all-time high in December, and since then the level of the spread has fallen, but remains high. Since February 2022, affected by the rising geopolitical tensions between Russia and Ukraine, international energy prices have skyrocketed, and the volatility of gas and oil prices at high levels has also made the price difference between them and coal continue to expand, and there is a trend of further expansion.