“Black Monday” is happening again. Stimulated by multiple bad news, New York oil prices plummeted on April 27. As of the close of the day, the price of light crude oil futures for June delivery on the New York Mercantile Exchange fell by US$4.16 to close at US$12.78 per barrel, a decrease of 24.56%. The price of London Brent crude oil futures for June delivery fell by US$1.45 to close at US$19.99 per barrel, a decrease of 6.76%. In the morning of the same day, the price of light crude oil futures for June delivery on the New York Mercantile Exchange once fell to $11.88 per barrel, a drop of 29.87%.
The U.S. dollar index closed lower on April 27 due to improved risk appetite and rising global stock markets. The U.S. dollar index, which measures the U.S. dollar against six major currencies, fell 0.34% on the day and closed at 100.0446 in late foreign exchange trading.
Corn, wheat and soybean futures prices on the Chicago Board of Trade fell across the board on April 27. Analysts believe that the new coronavirus epidemic continues to affect the market demand for ethanol, which is negative for corn futures prices; reduced export demand has suppressed wheat futures prices; soybeans are still waiting for news from buyers. On that day, the most actively traded July contract in the Chicago Board of Trade corn market closed at $3.1325 per bushel, down 9.75 cents or 3.02% from the previous trading day; the July wheat contract closed at $5.2475 per bushel, down 9.75 cents or 3.02% from the previous day. It fell 5.75 cents, or 1.08%, on the previous trading day; the July soybean contract closed at $8.365 per bushel, down 3 cents, or 0.36%, from the previous trading day.
The number of confirmed cases of COVID-19 worldwide exceeds 3.05 million, and the cumulative number of deaths worldwide exceeds 210,000. According to statistics from worldometers, a real-time information data update website, as of 6:31 on April 28, Beijing time, the cumulative number of confirmed cases of COVID-19 worldwide has exceeded 3.05 million, with a total of 3,058,226 confirmed cases and more than 210,000 deaths. There are 211,153 cases. The cumulative number of confirmed cases of COVID-19 in the United States has exceeded 1 million, reaching 1,007,162, and the cumulative number of deaths has exceeded 56,000, reaching 56,595.
International oil prices plummeted by nearly 25%, and the U.S. Cushing Reserve The oil space has been fully booked
Affected by the COVID-19 epidemic, global demand for crude oil has been greatly reduced, and oil prices have repeatedly hit new lows. Last week, under the combined influence of the epidemic and bulging inventories, as well as the “long-force” effect produced by the market trading structure, negative oil prices appeared for the first time in history. Although oil prices have rebounded since then. However, international oil prices plunged again in early trading on Monday. In addition, sluggish market demand and further shrinking of global oil storage space caused crude oil prices to end their previous rebound trend on Monday and plummet again. The price of West Texas Light crude oil for June delivery, also known as WTI futures, plunged 24.56% to close at $12.78 per barrel. In addition, London Brent crude oil futures prices fell 6.76% in June, falling below $20 per barrel.
During this period, the decline of U.S. WTI has been much higher than the decline of Brent, mainly because the worst-case scenario of U.S. domestic oil storage space reaching its limit is approaching. Facing the countdown. The market is paying the most attention to the Cushing, Oklahoma area because it is the largest oil storage facility in the United States besides the Strategic Petroleum Reserve. Cushing’s oil storage continues to rise rapidly, and industry insiders say that the little remaining inventory space has already been booked. So we may see the United States reach full inventory status in the first half of May.
Data show that the still increasing inventory in the United States has further reduced the storage space of oil storage facilities. U.S. inventories rose by 15 million barrels to 518.6 million barrels in the week ended April 17, according to the U.S. Energy Information Administration. Among them, the oil storage capacity of Cushing, Oklahoma, an important crude oil center in the United States, increased by about 10% within a week.
U.S. official data shows that 70% of Cushing’s storage capacity has been occupied, but feedback from market traders indicates that this is not accurate because the remaining storage capacity has been used by oil. Businesses are fully booked. Some analysts believe that the Cushing area will reach full inventory in the first half of May, faster than previously predicted.
At present, the demand for crude oil has not improved, but the excess crude oil has filled all the storage space in California, leaving many oil tankers with nowhere to go and can only drift at sea. A video recently released by the U.S. Coast Guard on social media shows that about 30 oil tankers have anchored in the waters off California, USA. The oil tankers loaded with more than 20 million barrels of crude oil have nowhere to go and can only anchor between Long Beach and San Francisco Bay. 20 oil tankers have been parked in nearby waters for nearly a week. The amount of crude oil carried by these tankers is equivalent to 20% of the world’s daily oil consumption.
Goldman Sachs Chief Commodity Strategist Jeffrey Currie predicts that global crude oil inventory capacity is expected to be tested in the next 3-4 weeks unless U.S. shale oil production Global inventories could reach their limits if manufacturers cut production significantly in the coming days, not weeks; a combination of weak demand, oversupply and a shortage of storage space could push prices below zero again.
From a data perspective, the latest weekly data released by the U.S. Energy Information Administration (EIA) showed that U.S. commercial crude oil inventories increased by 15.022 million barrels in the week ending April 17. 518.6 million barrels, the highest inventory level since May 2017;Oil prices will continue to remain weak, but the absolute low price may accelerate the pace of supply reduction, so that marginal improvements may accelerate unexpectedly. Judgments based on the trading level are more about following market sentiment, controlling positions, and paying attention to risks. Next week will be the last five trading days before the May Day holiday. Be sure to pay attention to risks and pay attention to the month change issue of the Brent06 contract.
Gold has entered a top oscillation and is still optimistic about the long term
Gold price Recently, it has shown a trend of top oscillation. London gold spot hit a high of 1,747.74 US dollars per ounce on April 15 and then stepped back on the 20-day moving average. It has now rebounded to 1,720 US dollars per ounce. Since there is currently no night trading, the high point of the Shanghai Gold 2006 contract was 383.24 yuan/gram on April 24. Although the current fundamentals of gold are still good, the trend shows signs of profit realization and weak growth.
Lin Xinjie, an analyst at Shenyin & Wanguo Futures, told the Futures Daily reporter that from the perspective of driving factors, the intensity of monetary stimulus policies, economic data and the trend of risk events have a greater impact on the recent gold trend. . “Among them, the loose stimulus policies of various governments and central banks are still the main support for gold prices.” He said that in order to ensure market liquidity and stabilize market confidence, the Federal Reserve adjusted the policy interest rate to zero and launched unlimited QE, and continued to increase policies. The intensity of easing and the scope of purchases far exceed the coverage of the previous plan. The Fed’s assets and liabilities have expanded by more than 50% in two months. The market has certain expectations for the Fed to further expand the scale and scope of bond purchases. As the main investment tool to hedge against the Federal Reserve and global easing policies, gold has solid support below.
Xu Ying, senior precious metals analyst at Orient Securities Derivatives Research Institute, believes that the U.S. economy has begun a downward cycle and the epidemic has accelerated the recession. Against this background, gold’s USD credit hedging properties have emerged. . Xu Ying said that the severity of the impact of the epidemic on the global economy and the intensity of this round of fiscal and monetary policy stimulus have stabilized the gold rising cycle. Looking back at the history of recessions, financial assets have led economic changes, but the policy exit process has been slow. In short, when recessions end, risk assets bottom out and recover. Starting from the bottom, the economic recovery has been slow, resulting in the continuation of loose policies and the US dollar index facing downward pressure, prompting the recent rise in gold prices. The fundamental reason is that extremely loose monetary policy and expanding fiscal deficits have eroded the credit of the US dollar, and gold credit hedging has emerged.
In terms of economic data, the negative impact of the epidemic on U.S. economic data has been realized. After retail sales, the New York Fed manufacturing index and industrial output hit the worst records in history, recent trends include The latest data on initial jobless claims, Markit manufacturing PMI, and new home sales are also sluggish, and it is difficult to improve in the future as the global epidemic has not yet reached an inflection point. “However, after the positive economic data has been realized, the market is now beginning to enter the economic rebound after the resumption of work. Since this economic recession is caused by the impact of the epidemic rather than financial imbalances, in the ‘liquidity risk-credit market risk-debt crisis With the logical chain of -financial crisis-comprehensive economic recession being cut off by proactive global monetary and fiscal policies, the market is expecting a strong rebound in the economy after the epidemic subsides, which indirectly inhibits the further upward momentum of gold.” Lin Xinjie said.
In terms of risk events, on the one hand, the scale of the global epidemic is still expanding, and the expectation that the United States will resume work in May has been further falsified, supporting the recent rebound in gold prices. On the other hand, last week Trump tweeted that the U.S. Navy would shoot down and destroy Iran’s gunboats if it harassed U.S. ships at sea. Geopolitical conflicts have been further highlighted under the pressure of the epidemic, which has stimulated safe-haven buying to a certain extent. In addition, the global gold price structure has changed to a certain extent. Lin Xinjie reminded that the epidemic has led to restrictions on the global air logistics system, and the regional segmentation of global gold pricing has become more obvious, while the suspension of gold mines and refineries has exacerbated the differences in gold supply and demand structures in different regions. Under the risk, overseas physical gold is in short supply, and the internal and external price structure has changed from a long-term domestic premium to a domestic discount. Since domestic gold import and export are controlled, the lack of arbitrage makes the price difference structure difficult to bridge.
“In the medium to long term, the decline in real interest rates and the depreciation of currency and credit have kept gold’s long-term upward trend unchanged, but the realization of bullish factors for gold such as the Federal Reserve’s policy and negative economic data has There is insufficient motivation for the gold price to continue to rise rapidly, and there is a need for continued adjustment in the trend.” Lin Xinjie believes that the main concerns of the future gold trend include when the turning point of the epidemic in the United States will appear, when the plan to resume work and production can be implemented, and a large number of U.S. gold prices are about to expire. Whether junk bonds and low crude oil prices will trigger a crisis in U.S. corporate debt, and whether the Federal Reserve will further increase its easing efforts.
In Xu Ying’s view, the Federal Reserve’s extremely loose monetary policy has taken the lead to provide liquidity, maintain the stable operation of the financial market, and prevent breaks in the credit market, but it also increases aggregate demand. It relies more on fiscal policy. The problem is that the US government debt level is already high. Under the special background of 2020, the proportion of fiscal deficit in GDP will increase significantly. In the medium and long term, this means that extremely low interest rates need to be maintained to absorb debt. Before the economy truly recovers and stabilizes, it will be difficult for the Federal Reserve to exit its easing policy. After the shortage of US dollars is resolved, gold will further appreciate against the US dollar.
After the shortage problem was resolved, gold further appreciated against the US dollar. </p
