What happened

As stock markets around the world continue to glow red, renewable energy stocks are in the green as the market reopens on Monday.

As of 10:10 a.m. ET, shares of solar power play Enphase Energy (ENPH 3.80%) are getting a 5.3% lift. Fuel cell play Plug Power (PLUG 1.26%) is up an equal 5.3%, while rival fuel cell company Bloom Energy (BE 10.99%) is gaining 8%.

Three colorful arrows racing straight up on a black background.

Image source: Getty Images.

So what

Oil is the reason.

As OilPrice.com reports this morning, the cost of a barrel of West Texas International crude oil jumped 3% on Monday to more than $119 -- up 29.5% since the day before active conflict broke out in Europe. Brent crude is jumping even higher, up 4.5% today at more than $123 a barrel -- and up more than 31% since Feb. 23.

What does the price of oil have to do with the value of solar stocks, and fuel cell stocks? Simply this: Both solar (which generates electricity from sunlight) and fuel cells (which generate electricity by running natural gas or hydrogen through an electrolyte membrane) are alternative ways to generate power -- alternatives to oil.

As such, whenever the price of oil goes up, the cost of generating power by either of these alternatives becomes relatively more attractive, increasing demand for power from these alternative sources. Additionally, each lift in the price of oil gives more room for solar and fuel cell companies to charge higher prices themselves -- increasing their profit margins.

Now what

Now it's an open question how long high oil prices will stick around. In last week's State of the Union speech, President Joe Biden promised that the U.S. and "30 other countries" around the world will soon "release 60 million barrels of oil from reserves around the world," which could temper oil price gains. Additionally, citing "extraordinary times," Tesla CEO Elon Musk on Friday called for U.S. oil and gas producers to "increase oil & gas output immediately" -- a call that, if heeded, would also work to lower oil prices (and thus make alternative energy stocks like Plug, Bloom, and Enphase relatively less attractive).  

That being said, there's also the possibility that oil prices will continue rising regardless of these ameliorative measures. Indeed, last week Barron's quoted a J.P. Morgan analyst suggesting that an oil price of "$185 isn't out of the question."  

If that's the direction oil prices keep heading in, renewable energy investors could be in for even greater gains in the weeks and months to come.