Influenced by the news that the United States is ready to terminate the sanctions exemption for Iranian oil imports, the price of crude oil at home and abroad has risen sharply. Analysts believe that supply constraints combined with geo-conflict will accelerate the pace of oil price rise, the global heavy oil supply gap is difficult to solve in the short term, and oil prices are expected to remain strong.
News Surface Stimulation Strengthen
Influenced by the news, crude oil futures at home and abroad rose sharply this week. WTI crude oil futures rose by 2.62% to $65.75 a barrel in the United States, reaching the highest level of $66 a barrel since November last year; Brent crude oil futures rose by 3% to $74.13 a barrel, up to $74.31 a barrel; domestic crude oil futures rose by 3.31% to $490.2 a barrel.
Reportedly, the U.S. government is ready to announce an end to the exemption from sanctions on Iranian oil imports. All Iranian oil importers must stop importing in a short time, or they will be subject to U.S. sanctions. The United States resumed sanctions on Iranian oil exports in November last year, while granting eight Iranian crude oil importers temporary exemptions for six months.
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Analysts pointed out that with the end of the sanctions exemption period, Iranian crude oil will face zero export dilemma in the future, which will greatly increase the tension of the current global crude oil supply system, but also lead to geopolitical risk. Because Iran controls this important oil pipeline in the Holmes Strait.
According to statistics, the Strait of Hormuz is responsible for nearly 40% of global oil exports, and more than 90% of the total oil exports in the Persian Gulf pass through the Strait of Hormuz. At the same time, about 17 million barrels of crude oil tankers pass through the Strait every day, accounting for about 30% of the world’s crude oil shipments by sea. In the context of further deterioration of US-Iran relations, supply tensions and overlapping geopolitical conflicts will accelerate the pace of oil price rise.
The supply pattern is difficult to understand
API data show that as of April 12, U.S. crude oil stocks fell by 3.1 million barrels to 452.7 million barrels; Cushing crude oil stocks by 1.6 million barrels; and gasoline stocks by 3.6 million barrels.
Analysts believe that the data suggest that the pace of global crude oil demand may slow down, and that if OPEC producers achieve production reduction targets, the crude oil market may achieve a balance in the second quarter.
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Analyst Ann believes that the global heavy oil supply gap is difficult to solve in the short term. Globally, Saudi Arabia has the potential to substantially increase production in a short period of time, so whether Saudi Arabia’s output policy will adjust to the demands of the United States next will be crucial. The current situation is very similar to that in May last year, but after last year’s “roller coaster” oil prices, even if Saudi Arabia may ease production cuts due to the escalation of sanctions imposed by the United States in the future, in order to avoid repeating the same mistakes, its policy adjustment is likely to lag behind.
It believes that the market will pay more attention to Saudi Arabia’s output policy. After a sharp fall in oil prices in the fourth quarter of last year, Saudi Arabia will be more cautious in adjusting its production policy, which means that Saudi Arabia is less likely to release its supply substantially to the market in the short term. Against the background of a sharp decline in the scale of global refinery overhaul, the global crude oil supply gap is expanding. Therefore, in the future, oil prices will maintain the overall upward trend, Brent crude oil is expected to hit the top level of $85 per barrel.
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