In the “Oil Market Report” released yesterday, the IEA lowered its forecast for global oil demand growth in 2022 by 110,000 barrels per day to 2 million barrels per day; and slightly lowered its forecast for global oil demand growth in 2023 to 2.1 million barrels per day. . At the same time, the IEA slightly reduced global oil demand in 2022 by 300,000 barrels per day to 99.7 million barrels per day.
On the supply side, the IEA monthly report showed that global oil supply increased by 790,000 barrels per day in August, reaching 101.3 million barrels per day, continuing the highest level since the COVID-19 epidemic.
Regarding Russian oil, the IEA monthly report showed that Russian oil exports increased by 220,000 barrels per day in August to 7.6 million barrels per day, but were still 390,000 barrels per day lower than the pre-conflict level. According to the report, with the United States and other IEA member states releasing emergency reserves, and Russian oil showing amazing resilience in the international market, global oil supply is generally guaranteed.
In addition, the IEA also warned that oil prices may fall further as EU sanctions on Russian oil take effect in early December. The IEA predicts that the crude oil market will have a supply surplus of 1 million barrels per day in the second half of this year. However, supplies of diesel and aviation fuel for trucks remain “extremely tight” due to export restrictions and other factors.
So, what is the fundamental situation of crude oil now and in the future?
According to Dong Dandan, chief researcher of CITIC Futures Energy, crude oil terminal consumption has shown resilience. Neither land traffic nor air traffic has declined with the expected economic downturn, and the overall trend is still stable and strong. In early September, global land traffic levels, excluding China and Russia, climbed 0.6% on a weekly basis, with the four-week average growth of 2%. Among them, Asia-Pacific, Europe and the Americas increased by 0.1%, 1.8% and 0.4% respectively. In the week ending September 7, China’s congestion index increased by 5.5% month-on-month.
“From the perspective of crude oil supply, supplying countries are more willing to support prices. OPEC+ countries unexpectedly decided to cut production by 100,000 barrels per day on September 5, with planned production falling back to August levels, and Saudi Arabia stated that it would adjust production in a timely manner based on price fluctuations. Policy. Russia faces possible price limit measures from the G7, saying it will stop supplying energy to countries that implement price limits. Whether the United States will restart SPR release is also the focus of the market. During the week, the White House said it would release reserves if necessary. From high frequency In terms of inventory, the United States is overstocked and Europe and Asia are destocking. The total oil inventory in Europe and the United States is still at the lowest or low level in the same period in five years. From the price structure, the monthly difference in crude oil is stable with almost no change, and the monthly difference in Brent is slightly higher. ; The crack spread of refined oil products remained stable every week and declined regionally. It is difficult for the oil price trend to appear for the time being.” Dong Dandan said.
Yide Futures analyst Chen Tong believes that from a macro perspective, the more aggressive tightening policies adopted by major Western central banks have restricted economic activities, and the global economic recession has gradually moved from expectation to reality. Geographically, the United States stated that there are still “disagreements” in the Iranian nuclear negotiations, and the expected return of Iranian crude oil has been postponed again. Russia said it would stop selling oil to countries that support setting a price cap on Russian oil. There are still doubts whether Western countries can set a price cap to replace the Russian oil embargo. On the supply side, the 32nd OPEC+ ministerial meeting decided to cut crude oil production by 100,000 barrels per day in October, while the market had previously generally expected production to increase by about 500,000 barrels per day in the fourth quarter. From this point of view, oil inventories are expected to remain balanced or omitted in the fourth quarter. Taken together, the game between macro and micro factors in the crude oil market will intensify in the future. Against the backdrop of OPEC+ production cuts and Russian oil exports still expected to decline, the downside space for international oil prices is expected to be limited. Investors will still need to pay attention to the actual changes in OPEC+ supply, including Iran and Russia.
Yang An, head of energy and chemical research at Haitong Futures, said that the change in API crude oil inventories announced early Wednesday morning was 6.035 million barrels, the largest increase since the week of April 8, 2022. Oil prices did not fluctuate significantly after the API data. There are some signs of recovery on both the supply and demand ends of the crude oil market to support the rebound in oil prices. However, the release of the latest CPI data in the United States has obviously made the rebound more difficult. It is expected that the market will take some time to digest and absorb the negative macro effects. Judging from market performance, oil prices were once under pressure and showed signs of panic, but the recovery in oil prices this morning also showed its resilience, indicating that the rebound in oil prices has certain basic support.