Bloomberg Markets reporter and analyst Grant Smith pointed out that oil prices will be bullish in the future under the influence of factors such as increasing spot delivery premiums, bullish global oil inventories and freight transactions, and increased geographical risk. However, as crude oil supply continues to increase across the Americas, compounded by weak oil demand, the downward trend in global oil inventories is bound to slow significantly in the fourth quarter, making it unlikely that oil will soar to 90 US dollars/barrel.
Oil prices fluctuated in a narrow range this month. By Monday's close, Brent crude oil futures for September had fallen by nearly 4.8%, while WTI's crude oil futures for August had fallen by more than 4%. The overall trading of US oil in the intraday range is 77.58-84.52 US dollars/ounce. Overall trading in the oil market is in the range of $81.61-87.95 per ounce.
On Monday, July 22, EST, Bloomberg Markets reporter and analyst Grant Smith pointed out that under the influence of factors such as increasing spot delivery premiums, declining global oil inventories, bullish freight transactions, and increased geographical risks, oil prices are bullish in the future.
First, in the futures market, the premium for spot delivery has been increasing in the past six weeks due to increased demand for spot supply as demand for American driving climbs to a peak in summer.
Second, the long-term premium on spot supply (rising spot price) indicates that global oil stocks are rapidly declining at the rate predicted by forecasters such as the International Energy Agency for the current quarter. According to the data, US crude oil reserves have been reduced by about 20 million barrels in the past three weeks, confirming the trend of declining global inventories.
Furthermore, freight transactions have added support to the overall bullish situation. Prices of crude oil such as Azerbaijani light crude oil in the Mediterranean region have risen sharply, and the bid price for CPC mixed crude oil has reached the highest level in four years. The wildfires in Canada and the hurricane season in the Atlantic have increased short-term supply risks, further supporting expectations of higher oil prices.
Although the market is currently bullish, there are still questions about the extent to which oil prices can rise in the future. Smith pointed out that as crude oil supply continues to increase across the Americas, compounded by weak oil demand, the downward trend in global oil inventories is bound to slow significantly in the fourth quarter, and forecasters predicting that the price of Brent crude oil may soar to $90 per barrel may still be disappointed.