Crude oil prices face life and death test for Fed
Hide the rapids in calmness!
Crude oil prices face life and death test for Fed
Original title: Hidden rapids in peace!
Crude oil prices are facing the Fed’s life and death test Source: Haitong Futures This week, crude oil prices experienced a dramatic scene. Under the situation of relatively large overall and increasing US crude oil inventories, crude oil prices did not rise but fell, shorts completely collapsedInitiative.
However, it is precisely because the overall volatility is too large that there is no basis for large price declines, so this week’s crude oil prices fluctuated within a relatively narrow range.
Above all, we suspect that it has something to do with Cemex’s hedging plans.
But this is only speculation. Regardless of the reason, Lido does not rise but it falls sharply, which needs to alert us enough.
In the next market, we will focus on the Fed’s interest rate meeting next week.
The European Central Bank has decided to keep interest rates low and has expressed its intention to continue easing. The next thing is to see what the Fed will do.
Although the market expects the Fed to cut interest rates relatively high, from the previous two statements of the Fed we can find that the Fed still has many concerns about the issue of interest rate cuts.
Another observation point should be placed on Iran. In the current undercurrent surrounding Iran, we should always pay attention to the sudden impact of Iran’s direction on crude oil prices.
From the current overall situation, there are no prominent contradictions in the fundamentals, and the price consolidation at this position does not seem to have a basis for serious reduction. Next week, we will focus on the interest rate meeting.
Disturbance in the U.S. market This week, the crude oil data in the U.S. market was distorted, and it was ultimately the aftermath of the hurricane.
In Monday ‘s EIA inventory data, US crude oil production increased by 700,000 barrels per day to 11.3 million barrels per day, and production occurred significantly in the week affected by the hurricane by 1 million barrels per day.
Crude oil inventories increased significantly by 10.83 million barrels per day, exceeding the expectations by far.
Historically, data distortion was not the first time due to the impact of hurricanes. It occurred once in 2018 and twice in 2017. Among them, Hurricane Harvey in 2017 almost affected crude oil production, and it also affected refining.The start of the plant, we choose the fundamentals in history similar to this week to see the ultimate trend of oil prices.
However, after comparison, we found that the impact of hurricanes is very different each time. The impact of hurricanes that affect refinery production (such as September 1, 17) has a negative impact on inventory. Crude oil inventory increased by 458 that weekMillion barrels, while output increased by nearly 750,000 barrels / day, prices increased by one.
Hurricanes that did not affect the refinery (such as October 2017 and July 19, 2019), production increased to good inventory, crude oil inventories replaced the change in the length of the week, especially the inventory data this week, but the price performanceHowever, it was not satisfactory. Prices in October 2017 only flattened, and this week prices have fallen sharply.
It seems that there is a transmission uncertainty about the impact of the hurricane on the inventory and the rise and fall of the night price announced by the EIA.
However, we cannot deny that the impact of the hurricane on inventory will be converted into prices, but the trading logic of the market often changes.
In this week, before the EIA data was released, we had expected that the inventory would drop, and the probability of oil prices would rise, but the result was contrary to expectations. After only a brief increase in prices, prices began to decline rapidly.
Judging from the long and short competition in the plate, the short side has taken great initiative, and the bulls have always been pressed to the ground to rub.
Therefore, we believe that such strong selling pressure may come from Mexico’s hedged position.
It is reported that crude oil rose short-term after the release of EIA data, and then two large orders hit the market. NYMEX’s most active WTI crude oil futures contract was two minutes at 23: 43-23: 44 and 02: 11-02 in the morning.: 15 total value within 10 minutes is 10.
20 billion and 15.
$ 2.3 billion in order-to-trade contracts.
We therefore predict that the decline in prices is inextricably linked to Mexico’s hedged positions.
However, despite this, we still see better US crude oil inventory data. We also saw that during the US crude oil destocking phase, the destocking rate this year was the highest in nearly five years, which also indicates that the US market is improving.
Therefore, for short-term oil prices, although we have seen the above pressures, we should also see that there will be no basis for a big drop in oil prices.
The non-US market basically maintains stability. In fact, from the perspective of fundamentals, we have not yet realized the overall deterioration of fundamentals. At least, during the OPEC + continuation of production reductions, the fundamentals have not been worse than unimaginable.
As for OPEC’s overall output situation, we only need to keep an eye on Saudi Arabia and Iran to reflect the overall situation.
In Saudi Arabia, we had a potential analysis before. We won’t go into too much narrative here. We still focus on Iran.
Since the West detained Iran’s oil tankers, the game between the two sides has entered a feverish phase, and Iran has also seized British tankers in retaliation.
The tanker incident can be said to be a trap drawn by the West to Iran in order to justify the promotion of the Hormuz Straits Convoy Alliance. At present, the prototype of this alliance has basically formed.
Just this Thursday, the British government announced that the Royal Navy would escort 西安耍耍网 British ships passing through the Strait of Hormuz.
It is reported that Britain is seeking to establish a maritime guard group led by European leaders to ensure the safety of navigation in the Strait of Hormuz, and the resettlement of Britain has received support from France, Italy and Denmark.
At the same time, the United States is also reluctant to show weakness in the Strait of Hormuz. The U.S. military has stated that more than one Iranian drone shot down by the U.S. forces. It’s a little bit interesting when things get to this point. The so-called escort formation changed its perspective to blockade the Iranian strait and completely interrupted the export of Iranian crude oil. This can be cut from the US sanctions on China’s Zhenrong. The reason for the United States is that ChinaThe company’s import of oil from Iran violates the U.S. oil ban on Iran.
The matter has reached this point. The next step depends on whether Iran will rise to rebellion. The consequences can be considered in two aspects.
If Iran admits to letting the West blockade, Iranian crude oil production will continue to gradually and Iranian crude oil will gradually withdraw from the market.
If Iran is tough, then Iranian crude oil can continue to be exported, then it depends on whether the so-called toughness in the West is a paper tiger.
So no matter from which perspective, the Iranian event is more favorable for oil prices, and it is difficult to predict whether this impact will be the first type of chronic benefit or the second type of sudden benefit.Need our attention.
In addition, from the perspective of demand indicators, at least at present there is no indicator showing complex and poor demand.
We have seen the start of large-scale refining and chemical projects since this year. China ‘s crude oil imports and processing volume have risen sharply, and the overall momentum remains good.
And through the second half of Zhejiang Petrochemical put into operation, China’s crude oil imports and refining inputs have more room for further growth.
However, India, the country, has shown an increase in demand for crude oil. In June’s data, India’s crude oil imports and processing volumes were presented.
Investigating the reason, we found that the consumption of gasoline and diesel in India showed a significant decline again, especially the Indian gasoline data is still growing, and the problem lies mainly in India’s refined oil exports.
India ‘s refined oil export volume has remained high, with total refined oil exports accounting for more than 30% of the month.
In particular, gasoline exports can reach more than 50%.
However, according to recent data, we find that through the overcapacity and rapid growth of demand in the Asia-Pacific region, India ‘s refined oil exports are constantly shifting, which has forced refineries to continue to reduce the operating load and reduce crude oil processing capacity.
However, on the whole, the current global overhaul of refineries is nearing the bottom, which currently represents the peak period of crude oil demand. If the crude oil bulls are not able to push the oil price through the market in a good window at this time, then the subsequent pressureWill be bigger.
Therefore, from the perspective of the overall fundamentals, before September, the demand for crude oil market will remain relatively strong, and the fundamental situation is relatively better. Crude oil prices have no basis to reduce from the fundamentals only.
But after September, the situation may not be so optimistic.
So overall, we think that the crude oil price this week has been disturbed by various factors. From the surface of the disk, we can see that the price conversion right is basically in the US disk, and the replacement right in the crude oil market will be handed over next week.In the hands of the Federal Reserve, the short-term market has continuous uncertainty.
Judging from the current market expectations, the probability of a rate cut is relatively large. If the Fed can cut interest rates as promised, then the pressure on oil prices in the US market may be weakened, and the probability of crude oil prices will gradually rebound depending on the bottom.
If the Fed continues to drag down the soil, it wants to cut interest rates but cannot lower them, then the short-term rebound of crude oil prices is still difficult, and the price is likely to continue its downward trend.
Therefore, investors holding unilateral positions must pay attention to controlling risks.