During the National Day, as OPEC+ held a meeting and decided to cut production by 2 million barrels per day from November to December, external crude oil rose for five consecutive years. However, as the good news was digested, external crude oil fell sharply after the holiday, and internal crude oil and fuel oil prices fell sharply. Crude oil varieties also recorded four consecutive negative days after opening higher after the holiday.
International oil prices rebound in deep V
On Thursday, international oil prices first declined and then rose, showing a deep V rebound trend. As of the close of the day, the November contract of WTI crude oil futures rose by US$1.84/barrel to close at US$89.11/barrel, an increase of 2.11%; the December contract of Brent crude oil futures rose by US$2.12/barrel and closed at US$94.57/barrel, an increase of 2.11%. is 2.29%.
Data released by the U.S. Energy Information Administration (EIA) on Thursday showed that U.S. commercial crude oil inventories increased by 9.88 million barrels to 439 million barrels in the week ended October 7, compared with an expected increase of 1.75 million barrels; U.S. Strategic Petroleum Reserve (SPR) inventories It decreased by 7.690 million barrels to 408.7 million barrels, the lowest since the week of June 15, 1984.
“Generally speaking, the United States has recently taken various measures to try to lower oil prices, including repeatedly calling for OPEC+, expressing the idea of continuing to release strategic oil reserves, etc. At the same time, macro pressure remains unabated, U.S. inflation is high, and the market expects the Federal Reserve to and December will raise interest rates by 75 basis points and 50 basis points respectively, raising doubts about the soft landing of the U.S. economy. In addition, the IMF continues to lower its global economic growth forecast in its latest World Economic Outlook report, predicting global economic growth next year. It will slow down to 2.7%, 0.2 percentage points lower than the forecast in July.” Zheng Mengqi, an energy and chemical researcher at Hizheng Futures, told the Futures Daily reporter that due to the above factors, crude oil prices have continued to fall in recent days, thus driving fuel oil and low-sulfur fuels Oil prices fell.
In terms of external crude oil, WTI crude oil fell from US$93/barrel on October 7 to the current US$87/barrel; Brent crude oil fell from US$98/barrel on October 7 to the current US$92/barrel.
According to Du Bingqin, an energy and chemical analyst at Everbright Futures, the continuous decline in crude oil this week reflects the market’s renewed concerns about the risk of economic recession. The monthly reports of the world’s three major institutions, EIA, IEA and OPEC, respectively lowered the growth rate of global oil demand this year to 2.12 million barrels per day, 1.9 million barrels per day and 2.64 million barrels per day. At the same time, the International Monetary Fund (IMF) has recently lowered its global economic growth forecasts for this year and next year. In addition, this week’s API weekly data showed that U.S. crude oil and gasoline inventories have accumulated significantly, causing further pressure on international oil prices.
Looking forward to the fourth quarter, Du Bingqin believes that as overseas economies slow down and European and American central banks maintain monetary tightening policies, the macro pressure faced by oil prices and the drag on demand may continue.
Zheng Mengqi said that from the perspective of crude oil supply, OPEC will have the say in global crude oil in the future. As oil prices fall to around US$80/barrel, member states’ willingness to reduce production to support crude oil prices has significantly increased. At the same time, it should be noted that the Russian crude oil shipping ban came into effect on December 5, and the implementation of a price ceiling may trigger Russia to take countermeasures. On the demand side, the economic recession caused by sharp interest rate hikes is expected to suppress crude oil prices. In its latest monthly report, the IEA significantly lowered its global oil demand growth forecast for 2022 and 2023, mainly due to the surge in oil prices and the global economic recession caused by OPEC+ production cuts. OPEC also lowered its oil demand outlook in its latest monthly report due to the economic slowdown. “In general, judging from the current reality of supply and demand, the positives are supported by OPEC+ production cuts, the negatives are supported by macro pressure, the longs and shorts are intertwined, and crude oil shows a wide oscillation trend. In the future, we need to continue to pay attention to the return of Iranian crude oil and the continued release of SPR by the United States. The downward risk of oil prices, as well as the upward risk of oil prices brought about by the escalation of geopolitical risks.”
Huang Liunan, a senior researcher at Guotai Junan Futures, told reporters that in the fourth quarter, under the background that overseas central banks are still carrying out tightening and the market’s expectations for a mid- to long-term economic recession have not changed, it is difficult for the short-term rise in energy prices to immediately induce the market to strengthen expectations for tightening. In the next 1- The trading perspective of the crude oil market in the two months may continue to return from macro expectations to micro supply and demand. However, it should be noted that under the influence of the current relatively pessimistic macro sentiment, the monthly rebound in crude oil is unlikely to happen overnight. After the oil price continued to rise sharply during the National Day, the upward offensive has slowed down this week, and the correction in the past three days has been Already reflected. However, in the long term, this round of restorative rebound is not over yet. The center of gravity of oil prices may partially rebound in the fourth quarter. The center of gravity of the two external oils may rebound to US$100/barrel before hitting new lows in the medium to long term.
In terms of fuel oil, as of Thursday afternoon’s close, the main contract of high-sulfur fuel oil led the decline in the energy and chemical industry, with a decline of 3.87%, closing at 2,706 yuan/ton; the decline of low-sulfur fuel oil was smaller than that of high-sulfur fuel oil, falling by 1.75% to 2,706 yuan/ton. 4710 yuan/ton. The main contract of SC crude oil futures stabilized, closing down 0.46%.
As for the trend of the main high-sulfur fuel oil contract yesterday, which was the weakest among oil products, Huang Liunan believes that there are two reasons: First, it is related to the shrinkage of the global shipping market and the contraction of ship fuel demand under the resonance of the tightening cycle of overseas markets; second, Russia’s external high-sulfur The month-on-month increase in fuel oil exports also continues to force the current Asia-Pacific high-sulfur fuel oil market to remain in a surplus pattern, prolonging the weakness of high-sulfur fuel oil.potential cycle.
In Du Bingqin’s view, the continuous decline of high and low sulfur fuel oil in recent days is mainly due to the resonance of the continuous weakening of international oil prices and the increasing supply pressure of fuel oil itself. Specifically, from the perspective of fuel oil fundamentals, the current continuous and sufficient supply has put pressure on the Asian high-sulfur fuel oil market. Low-sulfur fuel oil has been supported by the reduction of import arbitrage cargoes. The performance of higher-sulfur fuel oil is slightly stronger. The world’s three largest The recent increase in port inventories has put certain pressure on the fuel oil market. At the same time, due to sanctions and embargoes in Europe and the United States, Asia has become the main destination for Russian fuel. According to shipping schedule data, Russia’s fuel shipments to Asia continued to increase in August and September. From the current perspective, this trend has not changed yet.
“Fuel oil prices will still face potential pressure from the crude oil side in the fourth quarter. It is expected that high-sulfur supply in Asia will remain sufficient for the time being, while low-sulfur supply is expected to tighten marginally. With the end of the high-sulfur demand season in summer, the heating season in Europe, Japan and South Korea And high gas prices may bring a marginal increase in low-sulfur demand. In the fourth quarter, high-sulfur prices may be weak and low-sulfur prices are relatively strong,” Du Bingqin said.
Zheng Mengqi said that the current summer peak season for power generation in the Middle East is coming to an end, and the demand for high-sulfur fuel oil is gradually weakening. The conflict between Russia and Ukraine has not yet ended. The arrival volume of Russian fuel oil exports to Asia remains high, and the fundamentals of high-sulfur fuel oil are weak. , its price trend is also weaker than other energy varieties. Low-sulfur fuel oil is supported by the cracking of high-sulfur diesel fuel. Diesel components continue to be diverted. Coupled with high European natural gas prices and rising hydrogenation costs, its production is suppressed, resulting in low-sulfur trends being stronger than high-sulfur fuel oils. Next, the price difference between high and low sulfur may continue to remain high, and the absolute price will be greatly affected by fluctuations in crude oil prices.
International Energy Agency: Higher oil prices will have a major impact on the global economy
According to CCTV News, on the 13th local time, the International Energy Agency released the “Oil Market Report” for October. The report stated that the continued deterioration of the economy and the rise in oil prices triggered by the “OPEC+” production reduction plan are slowing global oil demand. The International Energy Agency emphasized that amid continued inflationary pressures and rising interest rates, higher oil prices will have a significant impact on the global economy, which is already on the verge of recession.
The International Energy Agency said that “OPEC+” large-scale oil supply cuts have increased global energy security risks. As a result, the International Energy Agency has lowered its oil demand growth forecast for 2022 and 2023. The International Energy Agency said that since 2022, oil demand growth has gradually declined. The fourth quarter of this year is estimated to be 340,000 barrels per day less than the same period last year. The full-year oil demand growth in 2022 is expected to be only 1.9 million barrels per day. The International Energy Agency also lowered its oil demand growth forecast for 2023 to 1.7 million barrels per day, 470,000 barrels lower than the previous estimate.
The International Energy Agency predicts that starting in November, “OPEC+” crude oil production will decrease by 1 million barrels per day, mainly from Saudi Arabia and the United Arab Emirates. In December, Europe began to implement oil embargo measures against Russia, which will further reduce global crude oil production.
Media analysis believes that the relevant statements of the International Energy Agency highlight the huge differences between it and OPEC, which also reflects the huge differences between the IEA member states and OPEC member states. This disagreement will seriously affect the stability of the international oil market.
The International Energy Agency was established in 1974. After the oil crisis in the Middle East, the major oil consuming countries established an international organization to coordinate the oil policies of various countries and reduce their dependence on imported oil. Currently, the International Energy Agency has 31 member countries.
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