Fu Xiaoyun et al.: The supply side is relieved or driving the second wave of oil prices

Zhongxin Jingwei July 8th.

Author Fu Xiaoyun Xingye Research Analyst

Guo Jiayi Xingye Research Chief Exchange Rate Analyst

The reason for the decline in oil prices from early June to the present

The decline of this oil price or the overall commodity market began by the US and European sanctions on Russia, and it was expected to continue to be suppressed by self -enhanced recessions.

The US CPI (Consumer Price Index) announced on June 10 was 8.6%year -on -year, reaching a new high of 40 years, breaking the dream that the US CPI thought in March has already seen its dreams in March. After that, the market believes that under radical interest rate hikes, or decline, it is expected to rise and suppress the goods, or the return of inflation to a reasonable level, which means that the final strong oil price in the product must also fall. In short, no matter what logic is, the market currently believes that the Fed's determination to suppress inflation for the time being, and since June, commodities have fallen generally. Since June, the decline in the crude oil market is mainly induced by macro expectations, which has also caused a stronger decline in the fundamentals of supply and demand in products since June to the present.

The cause of the continued adjustment of oil prices during the year

In the short term, after the commodity plummeted, most varieties fell to key support positions. The commodity market continues to kill the drums in the short term, or it has begun to rebound or sideways. But during the year, there is still a downlink risk.

The tension of the supply side will drive the second wave of oil prices. The tension of the real cargo market has formed a constraint on the recent decline in oil prices, and it is also the reason why oil prices have repeatedly rebounded strongly in key support. The sharp declines of oil prices at the time of October 2018 and early 2020 were accompanied by synchronization or early decline in the near -end price difference. Recently, the difference between the far -end price of crude oil has fallen, but the near -end price difference has shown toughness. Only a few days after this killing will fall to a certain extent.

In the future, if the real cargo market is tightly relieved, the crude oil market may feel the pressure from the downward downward downward downward downward and finance. At present, it is not good to predict the time and specific causes of the tension in the real goods market, but in the current situation of the U.S. government has taken anti -inflation as the primary goal, and the problem of the tension of the crude oil market is strongly mediate, as long as the United States is willing to be in a certain certain In some aspects, this situation will eventually be relieved at a certain moment.

The downward factor of the US economy is also worthy of attention. Recently, the market has brought about the impact of the US economy decline. However, from the perspective of high -frequency data, although the US economy has weakened, it still shows toughness. The downlink of high -frequency data in the future will bring further downlink of oil prices. Usually when people feel the downward pressure of the economy, they will have the behavior of dealing with stocks in their hands, and this active handling of stocking will make the staged goods on the market exceed the actual output, bringing the phased supply to diffuse the supply of the phased supply. Imagination.

Where is the support of oil prices?

When falling, finding support from the cost side is often a more effective way. Here we consider two costs. One is the fiscal profit and loss cost of the OPEC+(Oil producing country). Essence

In the stage of rapid response to oil prices, the half -cycle cost of shale oil has always been an important bottom support for oil prices. From 2016 to 2019, this cost is 40 to 45 US dollars/barrels, and it has fallen to $ 37 in 2020/2020/2020 to $ 37/USD/US $ 3/USD/US $ 3/USD/USA/US $ 3/USD/USA/US $ 3/USD/USA/USD. Barrels rose to $ 43/barrel in 2021. However, in the current situation of improving financial statements and placing financial statements and dividends for investors, the importance of semi -cycle of shale oil allows the cost of calculating capital returns. Before the oil price fell below the half -cycle cost, the shale oil company had obvious pressure reduction pressure, but when the oil price required for capital expenditure and capital returns at the current cost of oil prices, shale oil companies need to choose to reduce it to reduce Capital expenditure still reduces cash dividends. Considering the expenditure of oil and natural gas capital, accelerating the return of capital and continuing deleveraging. The current cost of independent exploration and production departments in the United States is about $ 60/barrel, which is increased by $ 10/barrel from 2018.

Not only the US independent exploration and manufacturers, European and American large oil companies, and OPEC (OPEC) countries have also increased significantly compared with the previous few years. In the case of considering capital expenditure, capital returns, and maintaining cash flow, the cost of weighted the average profit and loss of global oil companies rose from the $ 50/barrel calculated in 2018 to $ 70/barrel. The cost rose from $ 53/barrel in 2018 to $ 70 to $ 80/barrel. From 2016 to 2019, 50 US dollars/barrels have always been the volatile center of oil prices. The half -cycle cost of shale oil is supported by the bottom of the oil price. As costs rise, the vibration center of oil prices will also rise to $ 80/barrel. Under normal circumstances, oil prices will be supported and built at the bottom of the bottom at $ 60/barrel. The cost of $ 60/barrel of shale oil will be an important bottom support for oil prices under the circumstances of non -extreme decline. (Excerpt from Xingye Research APP) (Zhongxin Jingwei APP)

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