On May 19, international oil prices fell sharply. The settlement price of the main contract in the US WTI crude oil futures market was $63.35/ barrel, down $2.15 or 3.3%. The settlement price of the main contract in Brent crude oil futures market was at US $66.66/ barrel, down $2.05 or 3.0%. Although the US EIA inventory data released last week on Wednesday was positive, the market worried that the surge of new cases in Asia would further depress the demand for crude oil, and the new progress of the US Iran nuclear agreement released the expectation of increased supply; In addition, the probability of US inflation causing the fed to raise interest rates has increased, and oil prices have plummeted by more than 3%.
Recently, the bad atmosphere in the oil market is relatively strong. Earlier, some media disclosed that the United States and Iran have returned to the negotiation table in terms of restarting the Iran nuclear agreement. Affected by this, oil prices fell on Tuesday. In addition, the more important factor contributing to the continuous decline of oil prices is the concern of the epidemic situation. The new pneumonia cases in Asia continue to surge. The current situation in India is even more worrying for the market, which may have a negative impact on India's energy demand for a long time. In the later stage, there may be a chain reaction such as enterprise closure, which will bring a sharp drop in demand.
In addition, under the current inflation expectations, the market's concern about the increased probability of the Federal Reserve's interest rate increase also puts pressure on oil prices. Although Powell, chairman of the US Federal Reserve, was still more dovish in his remarks at the April meeting, saying that he would not raise interest rates for the time being.
On Wednesday, the US crude oil inventory data released tended to be positive. According to the commercial crude oil inventory data released by the US Energy Information Administration (EIA), the US crude oil inventory increased by 1.32 million barrels to 48611 million barrels in the week ending May 14, which was lower than the market expectation for an increase of 1.6 million barrels. Gasoline and distillate stocks fell more than expected. Distillate stocks, including diesel and heating oil, decreased 2.324 million barrels, to 132.095 million barrels. The market forecast is a decrease of 386 million barrels. From this point of view, the market demand is still improving, but the focus of the market is still on the epidemic situation and the outcome of the US Iran nuclear negotiations.
SunSirs crude oil analysts believe that the recent bad news of the oil market is diffuse, and the market mainly focuses on the progress of the U.S. - Iran nuclear agreement, which has triggered the fear of bulls. This is an uncertain bad factor, and the oil price will be more volatile in the near future. In addition, the severe epidemic trend in India and other Asian countries is certain, and it will still suppress oil prices in the medium term. However, it is still in the process of global economic recovery. The U.S. and European economies continue to recover, and China's situation is more optimistic. In the long run, crude oil prices are still positive.
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