Source of this article: Times Finance Author: Yu Siyi
International crude oil has risen for five consecutive trading days!
As of the close of October 8, Beijing time, WTI crude oil closed up 5.19% to US$93.04/barrel, up 16.7% from US$79.7/barrel on September 30; WTI November crude oil futures closed up 4.74% to US$92.64/barrel, setting a new closing high since August 29; Brent December crude oil futures closed up 2.7% to US$97.92/barrel, setting a new high since August 30. It is reported that the first single-week increase has reached double digits since March 4.
Image source: Tukong Creative
Since the domestic refined oil price adjustment is based on 10 working days as an adjustment cycle, the fluctuations in international oil prices during the National Day holiday are very important for the price adjustment of refined oil at 24:00 on October 10.
According to Zhuochuang Information APP, on October 8, the reference crude oil change rate in the 8th working day in China is 0.11%. If adjustments are made, gasoline and diesel are expected to increase by 5 yuan/ton. According to relevant regulations of the National Development and Reform Commission, "According to the international market crude oil price , adjust the price of refined oil in my country. When the price adjustment is lower than 50 yuan per ton, no adjustment will be made, and additional or offset will be added or offset in the next price adjustment."
plus October 8 and 9 are weekends, and there is no transaction in the international crude oil market. If crude oil does not fluctuate much next Monday, the latest price adjustment window will be 24:00 on October 10, and the price of refined oil is likely to not adjust.
According to a Xinhua News Agency reporter on October 8, it was learned from the National Development and Reform Commission Price Monitoring Center that based on the analysis and forecast of multiple institutions, the average international crude oil price in this round has dropped slightly compared with the previous round. Considering the exchange rate changes, it is expected that the price adjustment is "strapped" in this round of refined oil price adjustment window.
According to statistics from Times Finance, since the beginning of this year, refined oil prices have undergone 18 rounds of adjustments, with a total of "11 ups and 7 downs". According to the Oil Price Network, on October 8, the No. 95 gasoline in many places across the country was between 8.60 and 8.91 yuan/liter, and the No. 92 gasoline was between 8.10 and 8.40 yuan/liter. If the price of refined oil remained unchanged at 24:00 on October 10, the market earlier rumored that gasoline on the 92nd day would not be able to return to the "7 yuan era". The next price adjustment will be until the end of the month - 24:00 on October 24.
Zhuochuang Information Crude Oil analyst Zhu Guangming told Times Finance on October 8 that the sharp rise in the crude oil market this week was mainly due to the output cuts led by OPEC+, which far exceeded market expectations.
"Previously, the market generally expected that the production cut of OPEC + was between 500,000 and 1 million barrels per day. As a result, Saudi 's OPEC + alliance directly cut production by 2 million barrels per day, with the purpose of hedging the decline in demand caused by the economic recession. The sharp production cut far exceeds the market expectations, which directly led to the continued rise of oil prices. At present, oil prices have returned to the volatile range of 90-100 US dollars per barrel." Zhu Guangming explained.
According to Cailianshe, on October 5, OPEC+ decided to lower oil production by 2 million barrels per day from November, with a reduction of about 2% of global supply. After OPEC+ announced production cuts, the US government immediately responded to this.
In the latest announcement, White House expressed great disappointment and claimed that OPEC+'s decision was a "short-sighted behavior." Biden 's instructions, the U.S. Department of Energy will provide another 10 million barrels of oil to the market from its strategic oil reserves next month. The statement also reads that "to protect American consumers and promote energy security", Biden may continue to sell stocks "appropriately".
According to a survey by Huitong.com, OPEC's oil production rose to its highest since April 2020, exceeding the month's commitment to increase production. As production in Libya's recovered from the interruption, Gulf member states increased production in accordance with an agreement reached with allies. Despite this, OPEC's production is still far below the requirement. Therefore, in the market's view, if OPEC cuts production by another 2 million barrels per day, it will be difficult to meet demand.
Zhuochuang Information predicts that the Saudi-led production cuts do not take into account the demands of the United States, which shows that the game of oil prices' voice in the later period is more intense. The United States will continue to raise interest rates in and reduce the balance sheet of and , and even continue to cool down the oil market through selling reserves. However, Saudi Arabia and others will continue to insist on providing support for production cuts, and the game process between the two will dominate the wide fluctuations in oil prices. In the short term, under the supply-led expectations, oil prices will mainly be strong.
In early October, oil prices were mainly disturbed by the supply side. As mid-October enters mid-October, concerns about shrinking energy demand in Europe will re-plague the oil market trend, when oil prices face the risk of a decline. In a research report on October 7, Lu Shiwei, a researcher at the cloud energy and chemical industry, pointed out that in terms of demand, the core contradictions that currently affect oil prices are still concentrated on the supply problem that is difficult to continue to increase production and the sluggish demand expectations after weak economic growth. Considering the determination of the Federal Reserve to control social inflation in , the probability of raising interest rates by 75 basis points again this year is still relatively high, and the global economy has gradually entered a recession, especially the sharp shrinkage of industrial demand in Europe. In the long run, demand will suppress the strengthening of energy prices in the long run, and oil prices are prone to falling but difficult to rise.
Looking forward to the future, regarding the trend of crude oil prices in the fourth quarter, Zhu Guangming pointed out, "Under the background of sharp production cuts such as Saudi Arabia and the pressure on the United States, oil prices in the fourth quarter are relatively volatile, but the center of gravity will steadily increase. Considering the situation in Eastern Europe and European energy issues, there is great uncertainty in the fourth quarter, with the overall volatility range around US$80-100 per barrel."
