0 July 10 news , international crude oil prices rose for 8 consecutive trading days in early July. Analysts pointed out that this rebound in oil prices is purely "technical".
As expected, after the Independence Day holiday in the United States, the oil market returned to decline. After a brief rise at the opening of this week, it turned downward again, and the weak pattern was further strengthened...
This also caused nearly 3 The wavy downward trend of oil prices for more than a month has entered the latest downward wave, and the 200-day moving average has once again become an important resistance level limiting the rebound of oil prices. If nothing unexpected happens, the low of this round of decline is bound to be lower than the previous low, and whether the integer mark of US$40/barrel can be maintained will probably continue to worry the bulls who are still unwilling to give up.
So, what is the root cause of such weak oil prices? In addition to the cliche key factor of " shale oil blowout", there are more factors that cannot be ignored.
When talking about technological progress in the petroleum field, everyone’s first reaction is the familiar shale revolution. But technological progress is not limited to shale oil.
In the past few years, the increasing maturity of deep-sea drilling technology has also reduced the cost of some offshore mining projects by half or more. For example, in the waters of the Gulf of Mexico, the original comprehensive cost of extracting a barrel of oil was US$100, but now, this cost has been cut in half to US$40-50 per barrel. Considering that such progress was completed in just a few years Well, this situation can be called a miracle.
As a result, the Organization of the Petroleum Exporting Countries (OPEC) soon discovered that its role was somewhat similar to the coolie miner in the American folk tale who used flesh and blood to race against the machine and finally exhausted himself to death John Henry .
No matter how OPEC uses the resources it has at its disposal to once again try to regulate global oil production and prices, its efforts are becoming more and more like a mantis trying to block the wheel in the face of the rapidly changing "black technologies" in various industries.
In fact, it is the tragic drop in oil prices in the past three years that has promoted the Great Leap Forward in the field of oil extraction technology. In this process of sweeping the sand, only the oil producers who can best reduce costs can survive. The reorganization and merger of the industry have also strengthened further technology research and development capabilities.
Therefore, in the current wave of falling oil prices, manufacturers can still compete with prices and further push down the floor of production costs. This is the main reason why the oil market can enter a continuous downward wave-shaped channel.
By the way, from 2016 to the first half of 2017 alone, 10 more large-scale deep-sea exploration projects were put into construction, and the lifting of the ban on offshore adoption by US President Trump has unlocked a new source of supply, so As long as R&D work is not interfered with by the political sphere, technological progress will not stop. There is nothing wrong with being bearish on the oil market in the long term!
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