Yesterday, the U.S. Energy Information Administration (EIA) released a weekly report showing that U.S. crude oil, gasoline and distillate inventories fell last week. The EIA report shows that as of the week of September 10, U.S. commercial crude oil inventories excluding strategic reserves decreased by 6.422 million barrels, or 1.5%, to 417.4 million barrels, the lowest since the week of September 13, 2019. U.S. domestic crude oil production increased by 100,000 barrels to 10.1 million barrels per day. The four-week average supply of U.S. crude oil products was 21.126 million barrels per day, an increase of 16.9% from the same period last year. The United States imported 5.761 million barrels/day of commercial crude oil excluding strategic reserves last week, a decrease of 49,000 barrels/day from the previous week. U.S. crude oil exports increased by 282,000 barrels per day last week to 2.624 million barrels per day.
Affected by this news, international oil prices rose sharply. As of early morning closing this morning, WTI crude oil rose 2.64% and Brent crude oil rose 2.19%. The main Shanghai crude oil futures contract closed up 3.35% in night trading at 478.8 yuan/barrel.
“Affected by ‘Ida’, the U.S. Gulf of Mexico crude oil production reduction may reach 30 million barrels. At the same time, while ‘Ida’ caused a decline in U.S. crude oil production, demand in East Asia recovered It is happening now, and both the U.S. API and EIA weekly reports continue to reduce inventories. It can be said that the current tightening of crude oil supply and demand structure provides the core logic for the strengthening of oil prices.” Yang An, head of energy and chemical industry of Haitong Futures, said.
Yang An believes that the sharp rise in the prices of natural gas, coal and other fossil energy sources has increased investor expectations and has also given a certain boost to oil prices. In addition, oil-producing countries represented by OPEC and Investment banks are also building momentum for stronger oil prices.
Looking ahead to the market outlook, Li Yunxu, a crude oil analyst at SDIC Essence Futures, said that the overseas epidemic situation is still severe under the influence of mutant strains, but the growth rate of confirmed cases has declined recently. Many European and American countries are still implementing open-entry policies based on vaccine certification, and jet fuel demand is expected to still have room to recover during the year. Therefore, in the context of negative supply that does not exceed expectations, demand imagination is expected to continue to support the rise in oil prices. “We are about to enter the fourth quarter after the Mid-Autumn Festival. We will focus on the confirmation of demand recovery amid the development of the global epidemic and the progress of the Iranian nuclear negotiations. At the same time, we need to pay attention to the negative impact that the energy and foreign policies of China and the United States, the two largest consumers, may have on oil prices.”</p
