Last week, Laura, one of the most powerful hurricanes in U.S. history, hit. International crude oil prices rose amid concerns about the hurricane’s impact on crude oil production in the Gulf of Mexico. International crude oil prices also set a new high on Wednesday. It has reached a new high in the past six months, but the fall after the excitement shows that international oil prices have not yet shaken off the oscillation and rising situation. However, the performance of my country’s SC crude oil futures is eye-catching. In the past week, the trend of SC crude oil has been significantly stronger than that of the international market, officially starting the road to repairing the discount.
Technically, the current international crude oil price is relatively neutral, and the technical indicators are in the middle zone. There is no obvious trend direction, but technically it also shows that there is some room for the current price to go up or down. The pressure above the absolute price is still relatively heavy, but fortunately, Brent and WTI have completely covered the gap in the early downward jump. After filling the gap, it will be more beneficial to the price breakthrough. In addition, the 200-day moving average also gradually fell during the oscillation of oil prices, and the price slowly broke through the 200-day moving average by exchanging time for space. The 200-day moving average is usually understood by the market as the dividing line between long-term bulls and bears. Breaking through or not breaking through will have a certain impact on market sentiment. Therefore, short-term prices will pay more attention to the fermentation of new market variables.
However, as prices oscillate upward, we find that the monthly difference indicator does not follow significantly, indicating that the spot market supply and demand expectations are obviously not as optimistic as the oscillation upwards of absolute prices. We learned from the spot market that the current market is relatively weak and China’s demand has been overdrawn. Although there is an agreement to reduce production to continue to control the supply side, the discounts of many crude oils are still slowly declining, which is a relatively unfavorable factor for futures prices. If futures prices cannot be driven up by an increase in physical prices, then it seems unrealistic to rely solely on the release of liquidity in the United States to drive prices upward significantly. In addition, the U.S. stock market is currently at a relatively high level, and there is still no timetable for a new round of U.S. economic stimulus plans. It is not yet known whether the U.S. stock market can further set a new record high. Therefore, the oscillating upward trend in crude oil prices is not without variables.
In terms of the epidemic, the number of new confirmed cases in a single day in the United States is currently on a downward trend. Since Trump called on everyone to wear masks, the epidemic in the United States quickly reached its peak and began to decline. It has now dropped from more than 70,000 new cases in a single day to 40,000 new cases in a single day, and is still is in a downward channel, which shows that masks have played a great role in mitigating the epidemic in the United States. The easing of the epidemic in the United States will be of great help to the recovery of demand in the United States. Therefore, from the demand level, we may see a slow recovery in demand in the United States in the future.
In addition, the geopolitics in the Middle East is also something we need to focus on. The United States has recently proposed economic sanctions against Iran. Although the vast majority of members of the United Nations Security Council have previously opposed the United States’ request to activate the “quick restoration of sanctions” mechanism against Iran. But Pompeo wrote on social networking sites on August 27: The United States has launched a 30-day process to restore almost all United Nations sanctions against Iran. These sanctions will be reinstated at midnight on September 20. ”
Currently, Trump is very likely to make another fuss on the Iran issue. Of course, with the current economic situation of the United States, it is difficult to have a comprehensive friction with Iran. Conduct small-scale harassment against Iran through Middle East proxies. However, we must also be aware that the United States will take certain small actions against Iran. Under various pressures, Iran may also spill risks to the Middle East and disrupt the situation in the entire Middle East. To disrupt the strategic purpose of the United States. Therefore, although the Middle East seems relatively calm now, there are actually undercurrents surging behind it. We need to pay special attention to the huge uncertainty that Iran has brought to the global crude oil market.
Recently, the global epidemic control has been relatively satisfactory, and the number of new confirmed cases every day has finally shown signs of an inflection point. As of August 28, the cumulative number of confirmed cases of the global new crown epidemic has reached 24.57 million people, with 271,000 new confirmed cases that day, the current number of confirmed cases is 6.65 million, and the cumulative number of deaths is 836,000; the cumulative number of confirmed cases in the United States has reached 6.05 million, accounting for a quarter of the global total, with the number of new cases confirmed that day The number of confirmed cases is 45,000, and the current number of confirmed cases is 3.35 million, with a total of 185,000 deaths; the cumulative number of confirmed cases in India has reached 3.38 million, with 77,000 new confirmed cases that day, accounting for a quarter of the world’s single-day confirmed cases. , the current number of confirmed cases is 2.58 million, and the cumulative number of deaths is 62,000.
From a global perspective, there is a clear signal of slowdown in the number of new confirmed cases every day. It has been maintained at around 250,000 people for a long time, ending the situation where the number of confirmed cases continues to rise. In terms of countries, there are currently only four countries with more than 10,000 new confirmed cases per day, namely the United States, Brazil, India and Argentina. Cumulatively The countries in the first tier of confirmed cases are the United States, Brazil and India. The cumulative number of confirmed cases in these three countries has exceeded 3 million, far exceeding Russia, which ranks fourth.
The number of newly confirmed cases in the United States has also reached a clear turning point, finally ushering in a glimmer of light after the second outbreak. The decline in new confirmed cases in the United States has a significant impact on the United States The recovery of the economy will be a relatively big benefit. At present, American schools have not reopened normally, and the troubles of the epidemic are also reflected in the economic recovery. Although the United States has recently revised its GDP data for the second quarter, it is still terrible. The American market wants For complete recovery, the current epidemic prevention policy alone is completely insufficient. Before the vaccine is released, at least many industries will still be difficult to fully recover.
The most obvious example is China , although the epidemic has been brought under control, the aviation industry still needs the support of popularization of vaccines to fully recover. In addition, although the film and television industry has been partially liberalized, more people are worried about group gatherings and a certain rejection mentality. This is still the case in China , not to mention the United States. Although many Americans do not care about the spread of the epidemic, from the perspective of economic and social recovery, the United States still needs to wait for the arrival of a vaccine.
From the current perspective From the demand side of the United States, refining input continues to increase slightly, and refinery operating rates rebound to 82%. Although the recovery process is slow, fortunately, crude oil demand is still on an upward trend. The rebound in demand has also driven up the overall crude oil inventory Decline, the current inventory is in a seasonal decline cycle, but the rate of decline is actually not obvious, and there will be a short-term seasonal increase in October, so the time left for bulls seems to be really limited.
At present, the stimulus bill negotiations between the U.S. Democratic Party and the White House have not yet achieved a breakthrough. Last Thursday, U.S. House Speaker Pelosi and the White House Chief of Staff held negotiations on the deadlocked stimulus bill for the first time in three weeks. Talks, the two sides still have not made any breakthrough. Pelosi said that the Democrats will not give in, and the White House and Republican lawmakers must increase the size of the stimulus package. Pelosi said that the two sides are still stuck in a “pathetic stalemate” because the government does not recognize Experts and scientists agree on the scale of financial support that must be provided. She said Democrats are willing to reduce the size of the $3.4 trillion stimulus bill to $2.2 trillion. Republicans’ proposed stimulus bill is only about $1 trillion. The market predicts that the White House will not reach an agreement with House Democrats on the stimulus bill before the end of September, and that some stopgap measures may need to be implemented in the future to continue funding the federal government after October 1 and avoid a government shutdown. Democrats hope Providing $915 billion for state and local governments and maintaining supplemental unemployment benefits of $600 per week through 2021, which is significantly more than Republicans want.
The epidemic in India is also the focus of our attention. After experiencing exponential growth, the number of new confirmed cases in India began to slow down, but it still maintains a high-growth stage. India currently ranks third in the cumulative number of confirmed cases, very close to Brazil, which ranks second. India is the country with the highest number of new confirmed cases in a single day in the world, and is also the only country in the world with more than 50,000 new confirmed cases in a single day. Judging from current developments, the cumulative number of confirmed cases in India will soon surpass that of Brazil.
The main reason why we pay attention to India is that India is the country with the greatest potential for new demand for crude oil in the world. Before the epidemic, it was also a country with a high economic growth rate. The resumption of crude oil imports will be a big benefit. From a data point of view, the epidemic has had a huge impact on India’s crude oil. India’s crude oil processing volume is still lower than the same period in history. India’s crude oil imports continue to decline, with July data falling by 40% compared with January. While the global epidemic is basically stable, the epidemic in India is almost out of control. Coupled with the sharp decline in crude oil imports, when global crude oil demand will be fully restored depends on India. According to the bucket theory, India may be a shortcoming in the recovery of global crude oil demand.
Therefore, on the whole, there are many potential logics affecting crude oil prices, but none of them have evolved into the main logic so far. Crude oil prices are expected to continue to maintain strong oscillations after the impact of the hurricane. According to the pattern, short-term prices do not show obvious strong logic, and the state of a bottom below and a top above will continue.
Compared with the confusing deductive logic of international oil prices, the repair behind SC’s deep discount is an opportunity with high certainty. This year’s plunge in oil prices has brought historic opportunities. As the Chinese market is highly dependent on imports, low-price crude oil suddenly flooded into the Chinese market, and the excess supply of crude oil was piled up in the Asian market. The delivery warehouse receipts and floating storage at coastal ports in the SC market are as much as 100 million barrels higher than normal. This has also caused a rare phenomenon in the regional price difference structure of crude oil: as the benchmark oil price in the consumer area, the SC disk price is higher than the oil price in the production area. Low. Of course, this phenomenon will gradually repair over time. Starting last week, as supply pressure has passed its peak, there will be a gradual improvement process. We see that SC’s repair of international oil prices has begun, with the largest increase in the past 10 days. The repair value has exceeded US$2/barrel, and the repair process will continue.
The price is lower than the price of oil in the place of origin. Of course, this phenomenon will gradually repair over time. Starting last week, as supply pressure has passed its peak, there will be a gradual improvement process. We see that SC’s repair of international oil prices has begun, with the largest increase in the past 10 days. The repair value has exceeded US$2/barrel, and the repair process will continue.
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