A method for increasing oil recovery from an oil reservoir by injection of gas into the reservoir, is described. The method comprises separation of air into an oxygen-rich fraction and a nitrogen-rich fraction, reformation of natural gas together with oxygen to produce a synthesis gas for production of methanol or other oxygenated hydrocarbons or higher hydrocarbons. The raw synthesis products and a waste gas from the synthesis are separated, and the nitrogen-rich fraction and at least a part of the waste gas are injected into the oil reservoir to increase the oil recovery from the reservoir. A plant for performing the method is also described.