Brent crude oil, changed

Text: Wang Nengquan

The price difference between Brent crude oil and other oil and other oils has remained high, reflecting the impact of the Russian and Ukraine's influence on the flow of the oil market.

The major crude oil varieties, especially the Intercontinental Exchange of the International Petroleum Trade, have changed under the impact of the Russian and Ukraine. Analyzing this micro phenomenon, we can understand the complexity of the international oil market and international oil trade from one aspect, but also deeply understand the great impact and impact of the Russian and Ukraine on the global energy and oil market.

1

Large with other crude oil prices

According to the "Monthly Petroleum Market Report" published by OPEC, in June, almost all markets and all quality crude oil price differences have been strengthened, reflecting the strong fundamentals of the crude oil spot market. In July, the price difference between the premium of Buret crude oil and the WTI premium on the London Intercontinental Exchange expanded significantly. In late July, the average daily average of $ 11/barrel was high. Special crude oil. Based on monthly, the price difference between the price of the London Intercontinental Exchange Brent crude oil/New York Commodity Exchange was expanded by $ 2.58 per barrel, and the price spread in July was 5.74 US dollars per barrel. In July, the price difference between Beihai crude oil futures and WTI Houston crude oil futures expanded significantly, expanded by $ 2.25 per month to an average of $ 10.17/barrel.

In August, the EIA "Short -term Energy Outlook" shows that since March, the average difference in the price difference between Brent and WTI crude oil is 6.73 US dollars/barrel, which is higher than 2021 average of $ 2.69/barrel. Although the price difference between the two crude oil is expected to drop from the average 10.31 US dollars/barrel in July this year to US $ 6.00/barrel in 2023, EIA still insists that the price difference between the two crude oil is more than 4 US dollars per barrel predicted last month. Increase.

OPEC pointed out that in July 2022, the crude oil price difference in the international oil market increased further. Under the support of the strong demand of the refinery, the spot price difference between several crude oil reached a record high, especially in the Atlantic Basin. Among them, after a sharp rise in June, Beihai crude oil prices further strengthened in July. Because of the decrease in Russia's supply, European supply and demand balance remained strong, and the strong demand from European refiners and high refining profits supported Beihai crude oil. Fortis and Ekifisk crude oil price spreads increased 71 cents and 97 cents, respectively, and the average monthly level of July reached $ 4.99/barrel and $ 7.74/barrel.

Similarly, in the Gulf area of ​​Mexico, the spread of the price difference between Brent and the WTI and the rise in US crude oil exports (reached 4.5 million barrels/day on July 22), Louisiana light low sulfur crude oil and Maruis Sulfur crude oil price differences have increased. In July, compared with Ku Xin WTI, Louisiana light low -sulfur crude oil and Maruis's sulfur -containing crude oil increased increased, rising by $ 1.12 and $ 2.89 per barrel. Barrels and latter stickers are $ 3.33/barrel.

Sanctions on Russia are the main cause

2

EIA believes that since the outbreak of the Russian and Ukraine War, the global crude oil trade pattern has changed a lot, and its impact on European countries is particularly serious. As the European Union decreases crude oil imports from Russia, the number of crude oil imports from Russia from Russia at the end of this year may be reduced by more than 90%.

Historically, Russia has a large share in European crude oil imports. As the European refinery transferred the source of crude oil from Russia to a new area, they need new sources of crude oil to maintain the construction of refineries and provide the required fuel. The demand for new sources of crude oil has led to rising crude oil prices in Europe to attract new crude oil exports to the area.

EIA pointed out that the price of Brent crude oil is both the benchmark of global crude oil prices and the regional price benchmark for European crude oil. Because there are more crude oil consumed in the European market than the output of crude oil, the pricing of Brent crude oil is usually higher than other crude oil levels. Compared with other crude oil exported by Dubai and WTI Houston, the price of Brent crude oil has risen significantly since the end of February 2022, indicating that Europe has a strong demand for crude oil imported from oil zones from outside Russia.

On August 10, the EU's import ban on Russia's coal was officially effective. The European Union's sanctions on Russian coal have caused the world's coal prices to rise, especially the benchmark of coal trade in the Asia -Pacific region, and the world's important price reference -Australian Newcastle coal futures transaction prices have risen sharply. On June 3, the European Union announced the prohibition of imports from the import of Russia. Among them, Russia's crude oil is prohibited within 6 months, and oil products from Russia are prohibited from importing Russia within 8 months. The result of these behaviors is that the international oil trade flow has undergone significant changes. At present, the European Union's oil sanctions on Russia are in the process of implementation. It can be expected that in the future, we will see that Russia's oil will gradually and eventually be expelled from the European market. As a result, the crude oil produced by Brent itself will not only remain at a high price, but also keep The price difference with other crude oil will continue to be high.

In addition to coal and oil, the EU's actions that are getting rid of Russia's natural gas have also caused global LNG prices to rise and continue to maintain a high level. The international LNG trade flow is also undergoing major changes.

3

European market support

According to the "Petroleum Supply Monthly Report" data, EIA pointed out that in April 2022, the US crude oil exports to Europe had an average of 1.59 million barrels per day, which rose to the highest level (1.65 million barrels/day) since May. At the same time, the average export of crude oil exports to Asia and Oceania in April was 1.08 million barrels per day, which was the lowest level since April 2018, and in May increased to 1.34 million barrels/day. The decline in the US crude oil exports in the United States is that a large amount of crude oil exports have shifted to the decline in the demand for imports in Europe and China. Because several cities in China have implemented strict flow restrictions after the outbreak of the new crown epidemic in March and April. Since January 2017, the number of crude oil exports has been increasing, and its main exports have been exported to the in short East Asian region. At the same time, the United States exports crude oil to Europe. These exports must be competitive with the price of exports from other parts of the world (such as Russia or Africa) to European crude oil prices, because these areas are more geographically closer to Europe. Crude oil exported to the United States to Asia is also facing price competition with other Atlantic basin crude oil producers. For the above reasons, the price of WTI Kuhin crude oil and WTI Houston crude oil must be consistent with the price of Brent crude oil.

In recent months, while the United States has increased to European crude oil exports, Beihai crude oil transported to China has also decreased. The main reason for this phenomenon is that compared with the second quarter of 2021 and the first quarter of 2022, the number of Chinese crude oil imports in the second quarter of 2022 decreased slightly, and the source of imports changed. In the second quarter of 2022, the number of crude oil imported from countries outside the Atlantic Basin increased, and the crude oil imported from the Atlantic Basin was reduced. In May and June 2022, China did not import crude oil from the United Kingdom, and the import volume in April was less than half of the average monthly import level of the previous year. The relatively high price of Brent crude oil may prevent China from importing crude oil from Beihai's oil country.

For the above reasons, EIA believes that Brent crude oil has been supported by the strong market fundamentals of Northwestern Europe and the strong purchases of European refineries. These refining manufacturers need a large amount of spot crude oil to replace Russia's exports to European crude oil, so that the price difference between Brent crude oil and other crude oil is maintained at a high level. At the same time, due to the continuous release of strategic petroleum reserves in the United States, the supply of domestic oil markets in the United States, especially the Gulf of Mexico, has brought back a rising crude oil inventory in the Kunxin area in July. In addition, in the second quarter of 2022, the slowdown in US gasoline demand and weak economic data increased the downward pressure of WTI futures prices. The combination of the above factors has continued to decline since July, and the spread of the Valent oil with Brent is expanded.

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