I don't need to say the importance of oil. If you know more about oil, you will know more about its importance. The price of crude oil has been soaring in the first half of the year, but now the global economy shows signs of recession, the demand for oil seems to be declining, and it is becoming more and more obvious that the price has already "collapsed".
on Tuesday, the price of WTI crude oil fell by "1%", with an intraday drop of 1% to 97.43 USD per barrel, and finally fell to 8.2% to 99.5 USD per barrel. This is the first time that the oil price has fallen below 1 USD since May 11th, which is the lowest closing price of WTI crude oil futures since May.
At the same time, the price of Brent crude oil is not optimistic, falling by 9.5% to $12.77 per barrel. You may not feel the downturn of this figure, but you should know it compared with a month ago. A month ago, the price of oil distribution exceeded $12 per barrel.
the oil price has fallen below $1, and people will think, what's going on?
The epidemic is definitely one of the reasons. Everyone can imagine that the epidemic has seriously affected the economy. Everyone has tightened their belts, and the demand for oil has decreased, and the price has naturally fallen. This is understandable. According to relevant statistics, the global economic losses caused by the epidemic have exceeded 5 trillion US dollars, and more than 2 million jobs have been lost worldwide.
The Federal Reserve raised interest rates by 75 basis points, the largest single rate increase in 3 years, and the federal interest rate was also between 1.5% and 1.75%. However, the inflation rate in the United States is still very high, as high as 8.6% this month, while the Fed's expectation is 2%, which is too far away.
From the economic point of view, the Fed may continue to raise interest rates. It is predicted that the federal interest rate may reach 4%. If this is the case, the US dollar interest rate hike will continue, then the international futures market will definitely be greatly affected, which will also affect the price of crude oil.
to put it bluntly, the crude oil market is a financial market, and confidence is actually very important. This fall in international oil prices also illustrates a problem. Investors are not optimistic about this market for the time being. Many people at Citigroup in the United States know that the financial oligarch in the United States, the group analyst, said on July 5 that if the economic recession seriously affects the market demand, the oil distribution may fall to $65 per barrel by the end of this year and $45 by the end of 223.
In fact, the decline of international oil price this time is mainly due to the weak economic trend, which leads to the weakening of crude oil demand, which eventually leads to the increase of crude oil inventories and the decline of oil prices.
The sharp drop in oil prices will definitely affect domestic refined oil prices. According to the existing mechanism in our country, the next round of domestic refined oil price adjustment will start at 24: on July 12th. Some professionals predict that if the international oil price continues to fall, the domestic refined oil price may be lowered for the third time this year.