On January 5, the U.S. WTI crude oil futures market prices rose sharply, with the settlement price of the main contract at $49.93/ barrel, up $2.31, or 4.85%. Brent crude oil futures market prices rose sharply, the settlement price of the main contract was $53.60/ barrel, or $2.51, or 4.91%. International crude oil prices soared on Tuesday, with WTI and Brent crude oil up nearly 5%, mainly due to Saudi Arabia's unexpected announcement that it will voluntarily reduce production in February and March, and other OPEC+ member countries maintaining stable production.

On Monday, at the ministerial meeting of the organization of Petroleum Exporting Countries (OPEC+) and its allies (OPEC+), the meeting was temporarily suspended due to the lack of consensus. Affected by this, the oil price briefly recovered and closed down. At the supplementary meeting on Tuesday, there was good news. The results of the meeting are as follows: OPEC+ will continue to maintain its current total production in February and March. As part of the agreement, Saudi Arabia will voluntarily reduce production by an additional 1 million barrels/ day in these two months. Most OPEC oil producing countries will keep their production unchanged in response to the new round of blockade caused by the new epidemic. Russia and Kazakhstan will successfully increase production in February and March, but the overall control is dominant. Affected by the news, the oil price responded quickly and rose sharply.

U.S. commercial crude oil inventory data is also positive. Data released by the American Petroleum Institute (API) on Tuesday showed that U.S. crude oil inventory fell last week and refined oil inventory rose. Crude oil inventories fell by 1.7 million barrels in the week ended January 1, after analysts predicted a 1.3 million barrels drop. However, the inventory of refined oil products increased unexpectedly, and the gasoline inventory increased by 5.5 million barrels, which is estimated to increase by 596,000 barrels, indicating that the fuel demand situation is still not optimistic, the prospect of economic recovery is still uncertain, and the oil price is still an important factor in the later stage.

According to SunSirs, the recent oil price long short environment is relatively complex, and the supply and demand side has basically maintained a balanced state. On one hand, the OPEC+ production reduction policy has effectively supported the oil price, but affected by the epidemic, the blockade measures of some European countries have also hindered the recovery of fuel demand. On the other hand, with the advance of vaccination and the recent geopolitical uncertainty in Iran, it is expected that the oil price will still rise further.

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