"Diving" in oil prices impacts the world economy
On March 30, international crude oil prices fell again sharply. The price of US WTI crude oil futures once fell more than 7% during the session, falling below the $ 20 / barrel mark, the lowest reported at $ 19.92 / barrel, this is the first time since February 11, 2002, to fall below $ 20 / barrel. Brent crude oil futures prices fell more than 4%, hitting a new low of nearly 18 years. New York crude fell below $ 20 a barrel.
Analysis believes that despite the stimulus measures taken by central banks in various countries, there are still multiple uncertainties affecting the stabilization of oil prices.
Oil prices "stop falling"
"In the past month, international oil prices have changed like cliffs. At present, international oil prices are still crawling at a low level." Chen Fengying, a researcher at the China Institute of Modern International Relations, pointed out in an interview with this newspaper.
Falling oil prices have raised concerns in the United States. In recent years, the United States has become the world's major exporter of crude oil, but the current price of crude oil has been lower than the extraction costs of many US shale oil producers.
According to the US CNBC website, US Secretary of State Pompeo has held talks with Crown Prince Mohammed bin Salman of Saudi Arabia. The US State Department issued a statement saying "the two sides emphasized that the global energy market needs to be stable and Saudi Arabia has the opportunity to step forward when the world economy faces serious uncertainty to appease the global energy and financial markets."
On March 30, Russian President Putin spoke with US President Trump on the phone. According to the announcement of the Russian President's official website, the two presidents exchanged views on the current world oil market situation and agreed to hold a Russian-US energy ministerial consultation. The White House statement said the two reached agreement on the importance of stability in the international energy market. Affected by this, on the 31st, international crude oil prices were able to recover their losses slightly, and US crude oil futures rose more than 7%. However, as the OPEC + production reduction agreement expires, international crude oil prices are likely to continue to be under pressure.
Market supply exceeds demand
At present, the international crude oil market is facing serious risks of imbalance between supply and demand.
In the past month, differences among oil-producing countries have not eased. In early March, Saudi Arabia and Russia failed to reach an agreement on a reduction in production, which has sustained the reduction of production for more than three years and declared broken. The Commerzbank report believes that the "price war" on the supply side of crude oil still shows no sign of ending. Analysis believes that both Saudi Arabia and Russia have considerable fiscal reserves and strong leadership and are unwilling to compromise. Earlier, the United States released mediation signals several times, but with little effect.
"The downturn in the world economy has restrained global demand for oil. The situation of oversupply in the oil market has been exacerbated by the outbreak of the new crown pneumonia epidemic. In addition, the oil price war between Saudi Arabia and Russia has become the tipping point of this plummeting oil price. Chen Fengying pointed out.
The Goldman Sachs report believes that due to the impact of the new crown pneumonia epidemic on the economy, global crude oil demand is expected to decrease by 26 million barrels per day this week, accounting for 25% of total demand. The impact of demand on oil prices has surpassed the price war between Saudi Arabia and Russia. According to a report by the British "The Economist", the strategic reserve of US crude oil has reached 90% of its storage capacity, which is close to saturation, and it is difficult to further digest the incremental oil.
No price war winner
The International Energy Agency Administrator Bill Roll said recently that due to the new crown pneumonia epidemic, which caused 3 billion people to be in a blockade state, global oil demand is likely to experience a "free fall" decline, with an estimated daily demand reduction of about 20 million barrels. He called on Saudi Arabia to provide constructive support for stabilizing the global oil market as the presidency of the G20 this year.
Chen Fengying pointed out that there was no winner in principle in this plunge in oil prices.
The British "Financial Times" analyzed that in the face of current oil prices, US shale oil producers and Canadian tar sand producers will be unprofitable, which will likely force the US shale oil industry to liquidate quickly. Data show that recently, US energy producers have cut the largest drilling equipment in operation in five years.
Other oil-producing countries have a hard time. "According to Agence France-Presse, Iran, a Middle Eastern oil-producing country, recently announced that it is seeking emergency assistance of about $ 5 billion from the International Monetary Fund. AFP claims that this is the first time that Iran has sought financial assistance from the International Monetary Fund since 1962.
"The oil exporting countries in the Middle East and South America suffered heavy losses in the plunge in oil prices, and the sharp decline in export earnings caused by the plunge in oil prices will further cause a financial crisis in these countries." Chen Fengying analyzed.
"At present, oil prices will remain low in the short term. In the future, with the effective prevention and control of the new crown pneumonia epidemic and the gradual recovery of the world economy, the market demand for oil will increase. In the long term, oil prices may gradually rise. "Chen Fengying said.
Zhao Hao