International crude oil futures prices have fallen sharply since late April due to the continued increase in US commercial crude oil inventories and external emergencies. First, due to the increase in US production and the decline in demand, US commercial crude oil inventories continued to increase, which had a strong suppression of international oil prices. As of May 31, the US commercial crude oil inventories were 481.264 million barrels, an increase of 41.846 million barrels compared with the end of last year, an increase of 9.48%. The problem of oversupply in the United States has kept international oil prices under pressure. Second, the sharp rise in international oil prices in the first four months of this year was largely due to the escalating US sanctions against Iran. However, the US government recently announced a new round of Iranian nuclear talks with Iran. The US oil embargo against Iran may not be fulfilled. The market‘s worries have fallen short, and international prices have retreated. Third, economic data of major global economies, including the United States, have declined. This has caused the market to heat up expectations of the future global economic growth rate, further suppressing oil prices.
Supply is still tight
At present, the problem of tight balance between supply and demand of crude oil in the world has not improved. The main reasons for this problem are as follows:
First, according to the OPEC May report, the global demand for crude oil in 2019 is 99.94 million barrels per day, and the supply is 99.82 million barrels per day. Among them, OPEC production was 30.46 million barrels per day, non-OPEC supply was 64.52 million barrels per day, OPEC liquefied petroleum gas and unconventional oil and gas supply was 4.84 million barrels per day, and global crude oil gap was 120,000 barrels per day. The gap in April was reduced by 30,000 barrels per day, and global crude oil as a whole is still in short supply.
Second, although US commercial crude oil inventories continue to increase, as oil prices fall, drilling profits decline, and the number of active drilling in the United States continues to decline. As of June 7, Baker Hughes released data showing that the number of active drilling in the United States is 975, which is the lowest since February this year. This indicates that the US crude oil production will continue to decline, superimposing the peak season of summer refined oil consumption, the United States. Commercial crude oil inventories are expected to decline gradually, and their suppression of oil prices is expected to weaken.
Finally, there are many disturbance factors in the recent supply of crude oil. In Canada and the United States, due to natural factors, crude oil production in some regions has been affected. Russia, Iraq and other countries have also experienced a certain decline in crude oil production due to other reasons, which has led to the emergence of global crude oil supply. The problem of phased tightening.
Affected by many factors such as the resumption of negotiations between the United States and Iraq, international oil prices continued to decline. In the medium and long term, the Iran issue and US trade friction are difficult to resolve in a short period of time, and its impact on oil prices will continue. In the short-term, the number of active drilling in the United States is declining. Canada, Russia, and Iraq are affected by sudden factors, and crude oil production has also fallen sharply. Under this circumstance, the international crude oil supply and demand pattern is in a phased tightening state. .
Based on the above judgments, the author believes that the overall downward trend of oil prices has not changed at present, but considering the tight supply phase, oil prices are expected to rebound in the medium term, and domestic chemicals will also be driven.