According to market analyst firm S&P Global, Iran is expected to reduce its supply by about 1.4 million barrels per day as the US dollar limits Iran’s oil settlement to take effect on November 5, while supply is also available in Venezuela and Libya. Risks, these will jointly push up the cost of oil. According to the latest data from Platts, Venezuela's current daily production is only 1.2 million barrels, and crude oil production has fallen to its lowest level in 68 years.
Abandoning Iranian oil will lead to an increase in domestic gasoline prices such as Japan, South Korea and India / Picture Reuters
At the same time, due to the decline in Iranian oil supply, analysts accused the United States of the latest round of economic and financial sanctions against OPEC members of Iran to raise oil prices, rather than OPEC is reluctant to increase production to control prices. Saudi Energy Minister Falih said at the OPEC+ ministerial meeting in Algiers on Sunday: "We do not affect oil prices and do not intervene in oil prices." In addition, we noticed that Russian Energy Minister Novak also made a similar statement. .
According to the Wall Street Journal, Iran’s crude oil exports fell faster than expected and have already fallen into a passive situation. Meanwhile, according to a statement issued by the Iranian Ministry of Oil two days ago, it has confirmed that South Korean oil companies have completely stopped importing oil and become the first to import Iranian oil. Countries where the amount drops to zero. BWC Chinese network earlier premise, Japan's refiners have also unanimously decided to suspend the import of Iranian crude oil. In this regard, the oil companies of the two countries are coordinating the import of other Middle East crude oil as an alternative to supplement the pressure on domestic oil prices after the reduction of imports.
Image source Economy Watch
In response, according to Bloomberg News on September 24, citing analysts from the Mercury Energy Group, this will make it possible for crude oil prices to rise to $100 a barrel. Tok Oil Trading Co-Head Ben Luckock further explained that With the market tightening, crude oil prices may rise to $90/barrel before Christmas, and may rise to $100 in advance by 2019.
Data show that Brent oil prices closed above $81/barrel on Monday, rising nearly 2%, the highest since November 2014, and WTI also closed up more than $72/barrel. We have noticed that since 2014, oil prices have not returned to the level of 100 US dollars per barrel. As early as May this year, Bank of America has predicted that oil prices will return to 100 US dollars for the first time, which is less than the silent support of the United States.
Image source cyplive
We have repeatedly stressed that although the United States has been suppressing oil prices verbally, considering that the United States is now surpassing Russia to become the largest oil producer, it is based on the current US oil production data (August Day). The output is 1,090 barrels, which is only 120,000 barrels more than in June. It is still lower than Russia's daily output. In other words, the United States is more like protecting or supporting oil prices to help Saudi Arabia achieve the comfort zone of 80 US dollars. In this regard, Iranian Oil Minister Bijan Zanganeh once said that "the United States hopes that oil prices will rise and they are not honest."
As shown in the above chart, although US oil rig data continues to rise and crude oil production has reached a record high in the near future, US crude oil inventories are currently at their lowest level since March 2015. This also confirms our recent view that oil prices may start a new wave of rising cycles, while global oil production volatility will also increase or become sensitive, and these indirectly become the control of domestic oil prices. Part of the reason, in addition to factors such as tax costs (tariffs, consumption tax, value-added tax), logistics and refinery costs, will also affect domestic retail oil prices.
We have repeatedly stressed that as a major importer of crude oil, China's external dependence on crude oil has approached 70%. At the same time, the regulation of domestic refined oil sales terminals is also due to energy security requirements. According to data released by Xinhua OGP on June 4, China's commercial crude oil inventories increased by 1.3% in the end of April, but Xinhua OGP did not announce the specific inventory size, so it is difficult to estimate China's actual oil demand.
Picture source The Kiev Times
The domestic oil price that readers are most concerned about is strongly affected by the undercurrent of international oil prices in the past week. After the 11th increase in the retail price of domestic refined oil on September 17, September 30 may again meet again. At the same time, the agency also predicted that oil prices will start a small upward adjustment channel in November. However, Zhuo Chuang Information Oil Products Analyst also said in an interview with the media a few days ago, "The forecast for the next round of refined oil prices before the National Day is not expected. Large, the reason is the uncertainty of the global trade market, investors are not optimistic about the gap in the future demand side, oil prices have a large resistance, the probability of three consecutive rises is very low."
However, on the other side of the market, according to further analysis by Reuters, according to the latest forecast of Saxo Bank, many oil-producing countries including Iran have been very willing to settle transactions in the form of RMB, which means China. After the proposed large-scale purchase of imported oil in the renminbi, the move will directly help to hedge the energy import and cost premium risks brought about by the fluctuation of the US dollar, which means that the oil market's new currency "oil renminbi" is quietly rising.
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