Although nearly two years have passed, many investors in the energy market may still remember the historic scene of negative oil prices in April of the previous year: on April 20, 2020, the may contract price of us WTI crude oil futures closed at -37.63 US dollars per barrel. This is the first time since oil futures were traded on the New York Mercantile Exchange in 1983.
The share price of 6017 A shares fell to 857.89 yuan on the day of 2020, which was the lowest of 6017} in 10 months. Nearly 16 months later, the share price of Petrochina Company Limited(601857) has returned to 5.7 yuan, and the market value of has increased by 331.2 billion yuan .
Since then, the international oil price has been rising like a rainbow. After entering the second half of 2021, it has even continuously set a new high for many years.
On the afternoon of February 17, Beijing time, according to China Central Television News, the spot price of North Sea Brent crude oil in the UK market reached $100.8 a barrel on the 16th, breaking for the first time since 2014, according to the data of Platts energy information company.
Affected by the spot Brent spot price exceeding US $100 per barrel, the Brent crude oil futures price once exceeded US $96 per barrel on the same day. Bloomberg analysis, the recent rise in international oil prices is mainly due to crude oil demand exceeding the expectations of the International Energy Agency and other organizations. The report said that the expansion of crude oil demand and the failure of oil producing countries such as the organization of petroleum exporting countries to increase production in accordance with their commitments are all factors driving up oil prices.
the situation in Russia and Ukraine caused market concern
In fact, since the covid-19 outbreak, international oil prices have experienced several rounds of fluctuations. In April 2020, under the global spread of covid-19 epidemic, the international oil price fell deeply, and main crude oil futures once fell below $10 . From November 2020 to March 2021, oil prices started a round of continuous rise, from about $40 to about $70. After a period of shock, from late August to late October 2021, the continuous upward trend was started again, from about $65 to about $85. Until December 2021, there will be this round of rise.
According to China Central Television News, the spot price of North Sea Brent crude oil in UK market reached US $100.8 per barrel on the 16th, breaking 100 for the first time since 2014, according to Platts energy information company.
International oil prices continued to rise from the end of December 2021 and remained high during the Spring Festival. The light crude oil futures price on the New York Mercantile Exchange rose from about $62 per barrel in 2021 to more than $93 per barrel in February. The Bank of America released a report predicting that with the rebound of people’s travel demand in many countries, the rising trend of international oil prices may continue until the middle of this year, when the price of Brent crude oil may reach US $120 a barrel.
Meanwhile, the international spot price of gold rose to US $1879 per ounce on the 15th, the highest since June 2021.
Recently, the development of the situation in Russia and Ukraine has become the biggest uncertainty in the crude oil market.
According to Xinhua news agency, John kirdav, founding partner of the US “reinvestment” capital management company, said that the market is still highly sensitive to the tension between Ukraine and Russia, which has increased to an unusual degree.
The call between Russian President Vladimir Putin and US President Joe Biden on the 12th did not bring a breakthrough. Some moves by western countries have made investors increasingly worried about armed conflict between Russia and Ukraine.
US Secretary of state Blinken said in a statement on 14 July that the US State Department has initiated the procedure of temporarily closing the US embassy in Ukraine, and the embassy will transfer from Ukraine Kiev to Lviv, in the western part of the city.
The Russian Defense Ministry said on the 16th that the Russian troops deployed in the western region have completed their military tasks and started to return. The troops of the southern Russian military region also ended their military exercises on the Crimean Peninsula and set off to return to their stations.
On the 17th, according to China Central Television News, according to several Russian and American media reports, the armed forces in eastern Ukraine said that the Ukrainian government military mortar shelled their area .
Ukrainian media reported on the 17th that civil armed forces in eastern Ukraine launched artillery and mortar attacks on a village (Ukrainian side) in Lugansk region in eastern Ukraine at about 9:00 local time on February 17. The attack destroyed the kindergarten wall and injured three educators.
However, the civilian armed forces in eastern Ukraine responded on the same day that the Ukrainian military declared that the so-called “attack on the kindergarten” was false, and released photos, pointing out that the glass of the kindergarten was intact and the football on the shelf was placed neatly. This would not happen if it was attacked by artillery.
Russian Foreign Minister Sergei Lavrov said on the 17th that Russia would reply to the United States on security on the same day.
Lavrov said, “we have analyzed the letter from the United States. I hope you will see how things are going soon. At least, we will reply to the United States on this issue on the 17th.”
Lavrov said that Russia would make the reply public. The purpose of this is to let the people of all countries concerned about this issue know what is happening. “If we keep it secret like our American and NATO colleagues, the public will be blinded by lies and open gray propaganda, which is now full of major media.”.
Austria JBC energy consulting company said that Russia is the world’s major oil and gas exporter. If there is a conflict with Ukraine or Western sanctions, its oil and gas exports will be affected, which can not be digested by the market that has been trapped in tight supply. In such a tense situation, oil and gas prices may fluctuate in the new week.
Nisant Bushan, an analyst at lesta energy, a Norwegian oil and gas information service, said that Russia, as one of the major oil producing countries, any interruption in crude oil production will raise the crude oil futures prices in Brent and New York.
the supply is insufficient, and the international oil price may continue to rise in the future
According to Xinhua news agency, Andy Lippo, President of Lippo oil Tongren company, OPEC and non OPEC oil producing countries agreed to increase the average daily total production by 400000 barrels a month from August 2021. the market is skeptical that OPEC and non OPEC oil producing countries will restore their production to the pre epidemic level , while Saudi Arabia and Russia are the only two countries with large production space.
Due to the freezing rain and snow brought by the winter storm, some areas such as Texas suffered power failure in early February, the market is worried that the large-scale production interruption of the largest shale oil producing area in the United States as early as last year .
In addition, according to the data of Iraq’s National Petroleum Sales Bureau, Iraq’s crude oil production in January was much lower than the agreed quota of major oil producing countries.
The chairman of the organization of Petroleum Exporting Countries (OPEC) said on the 16th that under the condition of insufficient investment for many years, the organization cannot cope with the rising oil demand on its own.
According to the report, Bruno itoua, Congolese oil minister and OPEC chairman in office, said, “do we think we can respond quickly? I don’t think so.” During the epidemic, “we didn’t invest enough. We didn’t want to deal with it alone,” he said
Itoua said that oil producing countries other than OPEC should intervene, including a group of non OPEC oil producing countries led by Russia. US oil producers have also been slashing spending.
Manish Raj, chief financial officer of velandera energy, said that the crude oil inventory of OECD countries is at a low level for many years. The market depends on oil producing countries to gradually increase supply, but overestimates the production capacity of these countries. The organization of Petroleum Exporting Countries (OPEC) failed to produce crude oil according to the quota, worsening the gap between crude oil supply and demand.
It is worth noting that although the two main futures indicators, Brent oil price in the North Sea and WTI oil price in the United States, are still below US $100 / barrel. But generally speaking, the spot price is generally higher than the futures price.
According to the analysis of Rong Cheng (RSM), a financial and financial service company of China Central Television, if the fermentation of the Russian Ukrainian crisis pushes the international oil price to $110 / barrel, the US inflation level may rise to 10%. Even if this geopolitical risk is not fully included, more and more analysts expect higher oil prices to occur. Goldman Sachs previously predicted that the international oil price could reach $105 / barrel in the second half of this year. JPMorgan Chase has seen a maximum of $150 / barrel, which will exceed the level of $147 / barrel in 2008 , setting a new record.
retail prices of gasoline and diesel increased in many countries
While the price of crude oil in the upper reaches is rising, the price of gasoline directly consumed by the American people is also rising. The latest data from the American Automobile Association show that the average price of gasoline in California reached $4.719/gallon on February 16, about 7.84 yuan / liter. According to the head of the Association, this is the highest level since relevant statistics are available, On the same day, the average gasoline price in the United States was $3.514/gallon, the highest level since July 2014. American media have warned that the average price of gasoline in California may soon enter the era of $5 / gallon.
According to the statistics of the U.S. Department of labor, the price of various types of gasoline was 40% higher in January than a year ago, which is also one of the main factors driving up U.S. inflation.
According to overseas network, oil prices at French gas stations have been rising every week in the past two months. Against the backdrop of high demand associated with economic recovery, there is no sign that fuel prices have stabilized, let alone fallen.
French fuel prices are breaking records every week, Figaro reported. According to the latest data released by the Ministry of ecological transition, the average price of diesel in France this week was 1.6854 euros per liter, the average price of SP95 gasoline was 1.7654 euros per liter, and the average price of sp98 gasoline was 1.821 euros per liter, which are unprecedented levels.
At present, the fuel price in France is much higher than that during the “yellow vest” crisis in 2018. At that time, the price of diesel was 1.53 euros per liter and the price of sp98 gasoline was 1.64 euros per liter. Similarly, this is much higher than the level at the beginning of the covid-19 epidemic crisis. In early January 2020, the price of diesel was 1.49 euros per liter and the price of sp98 gasoline was 1.61 euros per liter.
In Japan, oil prices have also risen to a time when the government has to take action. According to the Kyodo news agency, on January 25 this year, Japanese economic and industrial minister Hagi Shengtian Guangyi announced at a press conference after the cabinet meeting that he would launch the suppression measures against the soaring gasoline prices for the first time.
On January 24, the average retail price of ordinary gasoline in Japan rose to 170.20 yen per liter (about 9.5 yuan), exceeding the starting standard of restraint measures. In Japan, government intervention in fuel market prices is rare.
It is reported that this is the first time that Japan’s gasoline price has exceeded 170 yen in 13 years and 4 months since September 2008. Hagi Shengtian said, “we expect the rise of wholesale prices to be restrained and can control the further surge of [retail prices].” The move aims to prevent the surge in oil prices from becoming a drag on the economic recovery.
China’s refined oil price increases
According to the national development and Reform Commission, a new round of refined oil price adjustment window will open at 24:00 today (February 17). According to the monitoring of the price monitoring center of the national development and Reform Commission, the international oil price continued to rise sharply during the current round of refined oil price adjustment cycle (January 29 to February 16). On average, WTI oil prices in London, Brent and New York increased by 5.26% over the previous round of price adjustment cycle. Affected by this, the retail prices of gasoline and diesel in China increased accordingly.
According to Xinhua News Agency reporters from the national development and Reform Commission, the details of the oil price adjustment are as follows: China’s gasoline and diesel prices increased by 210 yuan and 200 yuan per ton respectively.
National average: 0.16 yuan per liter of No. 92 gasoline; 95 gasoline will be increased by 0.17 yuan per liter; 0 diesel increased by 0.17 yuan per liter.
According to the estimation of 50L capacity of general household automobile fuel tank, filling a tank of No. 92 gasoline will cost 8 yuan .
In 2022, China’s refined oil price adjustment has risen for three consecutive times.
As of this price adjustment, gasoline prices have increased by 865 yuan per ton and diesel prices by 830 yuan per ton.
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