The trend of international oil prices faces uncertainty

　　The trend of international oil prices is facing uncertainty

　　 Luo Huaiwei, our reporter in Riyadh

　　In 2021, the global economy will gradually recover from the haze of the epidemic, and major economies will adopt loose fiscal and monetary policies to stimulate the economy, which will form a strong support for international oil prices.

At the end of 2021, the main contracts for light sweet crude oil futures on the New York Mercantile Exchange and Brent crude oil futures in London closed at $75.21 and $77.78 a barrel, respectively, up about 55% and 50% from the end of 2020, respectively.

　　The rise in international oil prices is affected by multiple factors such as global economic recovery, tight inventory and insufficient production capacity.

In terms of supply, OPEC and non-OPEC oil-producing countries have continued to implement production reduction plans despite the US’s request to increase oil supply to ease oil prices, and tried to maintain the current supply and demand situation in the international oil market, demonstrating their ability to control oil prices.

On the demand side, a steady rebound in economic activity and an increase in transportation fuel consumption are driving oil demand growth. OPEC expects global oil demand to increase by 5.7 million barrels per day in 2021 compared to the previous year, of which non-OECD regions are expected to grow by 3.2 million barrels per day. , the OECD region is expected to grow by 2.5 million barrels per day.

　　Throughout 2021, international oil prices are still fluctuating despite the overall rise, and the three major fluctuations are all related to the development of the epidemic: In March 2021, affected by the third wave of the epidemic in Europe, international oil prices rose from close to one per barrel. The highs of $70 fell to around $60.

In August, affected by the Delta strain, the prices of Brent and U.S. oil fell to $65.18 and $62.14 a barrel, respectively, on August 20, the lowest levels since May.

On November 26, the World Health Organization listed the Omicron strain as a variant that "requires attention". On the same day, the prices of Brent and US oil dropped to US$71.59 per barrel and US$68.15 respectively, a decrease of more than 10% from the previous day. %.

　　Regarding the development of the oil market and the trend of oil prices in 2022, the views of all parties are inconsistent, and the difference in the judgment of the epidemic situation is the main reason for the different analysis results of the parties.

　　OPEC is optimistic about the development of the oil market in 2022.

In its monthly oil market report released in December 2021, it believes that now that countries around the world are better able to deal with the new crown pneumonia epidemic and its related challenges, the impact of the Omikron mutant strain is expected to be mild and short-lived, and developed economies The economic outlook is stable for both global and emerging economies.

Global oil demand in 2022 is expected to increase by 4.2 million barrels per day from 2021 to 100.6 million barrels per day, and global oil production is expected to increase by 5.3 million barrels per day compared to last year.

In this case, the 24th OPEC and non-OPEC ministerial meeting held on January 4 decided to increase production by 400,000 barrels per day in February 2022.

　　In contrast, the U.S. Energy Information Administration expressed concern about the impact of the new coronavirus variant on the oil market in its Short-Term Energy Outlook released in December 2021, predicting 2022 production by OPEC and non-OPEC producers, the United States and other countries The growth rate will exceed that of global oil consumption.

　　The IEA's view of the supply and demand situation in the crude oil market this year is similar to that of the U.S. Energy Information Administration. In its December 2021 oil market report, it expected a surge in new coronary pneumonia cases to slow down the recovery in global oil demand, while in the United States, OPEC and Global oil production is expected to exceed demand from December 2021, led by increased output from non-OPEC producers.

The report predicts that the annual output of the United States, Canada and Brazil may reach the highest level in history this year, and the total output of OPEC and non-OPEC countries will increase by 1.8 million barrels per day. At the same time, if OPEC and non-OPEC oil production The remaining share of the country's production cuts is completely lifted, and Saudi and Russian output may set records.

In this scenario, global oil supply would surge to 6.4 million barrels per day in 2022.

　　At present, there is still great uncertainty in the trend of international oil prices, and the new crown pneumonia epidemic is still the biggest uncertainty factor affecting oil prices. As of now, due to the influence of the mutant strain of Omicron, international oil prices have not yet recovered to 2021. high point in October.

In a feature article reviewing 2021 and looking ahead to 2022, OPEC pointed out that the expected market balance will continue to be determined by the evolution of the epidemic, but OPEC and non-OPEC producers will continue to closely monitor developments and respond to rapid changes in market conditions. reaction.

Luo Huaiwei, our correspondent in Riyadh

Luo Huaiwei, our correspondent in Riyadh