① The conflict between supply and demand has caused oil prices to continue to rise. What is the institutional opinion? ② What impact will the current decline in global crude oil inventories have on the subsequent market?
Financial Services Association, April 8 (Editor: Feng Yi) Today, the commodity sector of Hong Kong stocks is flourishing across the board, and petroleum stocks continue to improve, driven by favorable price increases.
After the international gold price recently surpassed 2,300 US dollars, by the close of last week, the international crude oil price had broken through 90 US dollars/barrel for two consecutive days. Expectations that crude oil prices will break 100 are also gradually heating up, becoming another driving force driving the commodity market higher.
As of press release, Kunlun Energy (00135.HK) rose more than 3%, and CNPC (00857.HK) rose nearly 2%, once again hitting an 8-year high in the intraday period. Sinopec (00386.HK) and CNOOC (00883.HK) followed suit.
According to the news, Saudi Aramco, the world's largest oil company, raised the price of Arabian light crude oil sold to Asia in May to an increase of 2 US dollars/barrel compared to the benchmark oil price. This sudden price increase is also viewed by the industry as a guiding signal.
J.P. Morgan even predicted that as supply constraints intensify, oil prices may rise back to $100 per barrel by August or September of this year.
Looking at the present, the market has reached a consensus on strong oil prices due to OPEC production cuts. At the beginning of March, several OPEC and non-OPEC oil producers decided to extend voluntary production reduction measures of 2.2 million barrels per day in the first quarter of this year until the end of June to maintain the stability and balance of the international oil market. Meanwhile, the next OPEC+ joint ministerial meeting to be held in June is the next “critical juncture.”
It is worth noting that the high expectations for price increases have already been reflected at the transaction level. According to data from the US Commodity Futures Commission, in the week ending April 2, net long crude oil futures holdings held by non-commercial investors rose from 278,000 lots to 3080,000 lots, and net long positions rose to the highest level since October 2023.
On the other hand, a series of recent supply shocks that have exceeded expectations and the fermentation of geographical risks have also accelerated the upward trend in oil prices.
Last week, Israel launched an air strike on Iran's embassy in Syria, causing the situation in the Red Sea to continue to be tense. A Ukrainian drone then attacked a Russian refinery, affecting the plant's production capacity of about 170,000 b/d.
Furthermore, Mexico's oil exports fell 35% last month to their lowest level since 2019, and are expected to decline further in the future. Meanwhile, according to data from the US Energy Information Administration (EIA), US crude oil inventories fell by nearly 5 million barrels last week due to increased demand, far exceeding expectations.
Zheshang Securities analyst Ren Yuchao pointed out in the April 6 report that in the future, as geopolitical tension continues and supply concerns intensify, it is expected that international oil prices may continue to rise.
Also, according to a report by Dong Dandan, chief energy and chemical analyst at CITIC Construction Investment, on April 6, looking at overall supply and demand, global oil inventories have continued to decline over the past two weeks.
CITIC Construction Investment said that at present, there is still no obvious resistance on the demand side to high oil prices, negative feedback on high oil prices is still unclear, and the current view on oil prices is still strong.