ATFX：OPEC+Slight increase in production1010000 barrels/Today, international oil prices are under pressure and are declining

OPEC+Section31The ministerial meeting announced that, considering the latest fundamentals of the oil market9Upward adjustment of monthly production level1010000 barrels/Day, finalize next timeOPEC+The time of the meeting is9month5Day.1010000 barrels/The daily increase in supply is related to the average daily demand1About 100 million barrels of international resourcescrude oilIn the market, a drop in the bucket is a drop in the bucket. However, overnight US crude oil prices still fell3.15%, lowest touch87.55US dollars. The main reason is notOPECInstead of increasing production, there are concerns about the global economic recession.

Yesterday's minutes of the Bank of England meeting mentioned that the UK economy will end this year3Fall into recession for months and will continue until2023At the end of the year,GDPWill shrink by approximately2.1% . The core factors causing economic recession in the UK are high inflation and high interest rates. These two issues also exist in the United States. Britain6monthCPIGrowth rate9.4%, creating near40A new high in the year. AmericanCPIThe growth rate is9.1%, creating near41A new high in the year. Since October last year, the Bank of England has raised interest rates6Times, maximum single rate hike amplitude50Base point. Since the beginning of this year, the Federal Reserve has raised interest rates4Times, maximum single rate hike amplitude75Base point. Since the UK will experience an economic recession due to high inflation and high interest rates, it is highly likely that the US will also be unable to avoid it. The benchmark interest rates in the eurozone are still at a relatively low level, so there is no risk of recession in the UK and US.

Another indication of the risk of economic recession is the yield of the 10-year treasury bond bond. Take the yield of one-year treasury bond as the boundary. The longer the maturity is, the higher the yield will be; Higher than one year, the longer the time, the lower the yield. The bond market is betting that the Federal Reserve will shift from a rate hike to a rate cut in a year. AmericanGDPThe quarter on quarter ratio has been negative for two consecutive periods（-1.6%and-0.9%）This is interpreted by the market as a "technological decline". IfGDPThe month on month data has been consistently weak, and the Federal Reserve may indeed terminate its current aggressive interest rate hike path.

6month14Over the past two months, US crude oil has accumulated a decline27.49%The market price starts from the highest120Above, the decline to the present day90Below USD. The Russia-Ukraine conflict has not yet ended,OPEC+The increase in production has been lower than expected, and the supply side of crude oil is still in a tense state. Obviously, the main factor leading to the decline in oil prices comes from the demand side, and a decrease in demand means a global economic recession.

In the long run, the price trend of oil resonates with natural gas. However,7Since mid month, this resonance has become increasingly weak: natural gas prices have continued to rise, while oil prices have been falling all the way. So, why haven't natural gas prices been affected by the global economic recession? The answer is that the ventilation volume of the Beixi No.1 natural gas pipeline has not reached its peak. There is a diplomatic game between Russia and Germany in between. If the Beixi No.1 issue is properly resolved, natural gas prices are likely to enter a long and bearish path, just like oil prices.

ATFXThe analyst team's concise view: Economic recession expectations continue to suppress international crude oil prices,OPEC+The impact of increased production is relatively weak.

*Risk Tips and Disclaimers*
There are risks in the market and investment should be cautious. The above contents only represent the views of analysts and do not constitute any operational recommendations.
2022-08-05