Post-COVID economic recovery and now the war in Ukraine have prompted experts to warn that energy prices will climb.
Already a new gas pipe from Russia to Germany has been halted, placing higher demand for energy from other parts of the world.
According to Datt Capital chief investment officer Emanuel Datt, there are numerous voluntary boycotts of Russian products in addition to the official sanctions.
"For instance, a commodity trading house may struggle to obtain the requisite insurance and finance to cover the purchase and transport of a shipment of Russian-origin commodities," he said.
"As such, almost overnight, we have seen an enormous uplift in demand for commodities of non-Russian origin to fill this sudden supply gap."
Datt cited Newcastle thermal coal futures climbing 46% overnight to close at US$446 per tonne.
"This is in contrast to prices of ~US$190 a tonne only 2 months ago," he said.
"The price of crude oil has exploded with the Brent benchmark currently trading at ~US$116 a barrel vs US$77 a barrel 2 months ago."
All this has led to ideal conditions for investors to pounce on certain Australian companies that are set to benefit, according to Datt.
He specifically named 3 ASX shares in the energy sector "worth keeping a close eye on":
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Selling coal at 3 times the price
According to Datt, Russian coal supplies about 15% to 20% of Japanese and Korean demand.
As an exporter to those countries, Whitehaven Coal Ltd (ASX: WHC) can take advantage.
"Whitehaven's customers will likely be willing to increase purchase volumes from Whitehaven at higher prices than has been traditionally achievable."
Just sheer mathematics is on Whitehaven's side.
In the last half-yearly results, the company reported an average realised price of $211 per tonne.
"With current spot prices over $600 a tonne, we believe that Whitehaven is well equipped to capture these higher prices at greater production volumes than last quarter."
Datt also likes the $400 million share buyback, where Whitehaven could purchase up to 10% of its own shares on-market.
"The debt-free balance sheet and high-quality assets make this a compelling value proposition at a market cap of less than$4 billion."
Whitehaven shares have rocketed more than 43% for the year so far.
Gas and oil ready to be snapped up
Datt noted that Woodside Petroleum Limited (ASX: WPL) would now become "a global top 10 oil and gas company" after absorbing BHP Group Ltd (ASX: BHP)'s petroleum arm.
The business' last reported realised prices for liquified natural gas and oil were US$28/MMBtu and US$80/bbl respectively, which are considerably below current market prices.
"We see Woodside as possessing strong leverage to higher O&G prices going forward whilst also paying an attractive dividend yield."
Indeed, Woodside currently pays out a dividend yield of just over 6%.
And finally, Datt likes the look of Santos Ltd (ASX: STO).
"Last calendar year, Santos managed to capture realised prices of US$9/MMBtu for LNG and US$76/bbl," he said.
"Accordingly, there is a strong opportunity to capture materially higher prices given the current market conditions."
Datt added that the business has room for further productivity improvements.
"We also expect that Santos will reduce its stake in certain development assets, which provide the potential for future capital returns, along with its regular dividend."
Santos shares currently yield 2.54% of dividend payouts.
