At the beginning of the Asian session on September 7 (Wednesday), the US oil shock weakened, and is currently trading near $86.28 / barrel; Oil prices fell more than 2 percent on Tuesday as the prospect of more rate hikes and global pandemic measures that would weaken fuel demand reignited market fears, reversing the two-day rally brought about by OPEC+'s first production cut target since 2020, and the deputy U.S. Treasury secretary said $44 a barrel could be the "guide price" for Russia's oil cap measures. ”
Tip: Due to the Labor Day holiday, weekly inventory reports from the American Petroleum Association (API) and the Energy Information Administration (EIA) will be released on Thursday, a day later than usual, Beijing time.
Negative factors affecting oil prices
【Saudi Arabia lowers official price of October Arabian light crude oil to Asia】
Saudi Aramco said on Tuesday that the october official selling price (OSP) for the country's flagship Arabian light crude sold to Asia fell by nearly $4 a barrel, the first price cut in four months.
The world's largest oil exporter raised its Asian OSP to an all-time high in September, at a premium of $10.95 per barrel for Arabian light oil to the average Oman/Dubai price, and $9.80 per barrel for Arab light crude. Saudi Arabia also lowered its October premium to Brent crude to $2.70 a barrel for Arab light oil in Northwest Europe, while OSP against the United States remained unchanged.
U.S. crude has been trading unsettled since Sunday due to the Labor Day holiday. According to Refinit Eikon data, U.S. crude oil prices are down more than 2 percent from the price at the usual settlement time on Monday.
Tamas Varga, of oil broker PVM, said: "There is now OPEC+ news in the market, with the focus temporarily shifting to economic and inflation concerns, two of which are the ECB interest rate decision on Thursday and the extension of the coronavirus closure by Asian powers. ”
[EU ministers will discuss setting a cap on Russian gas prices on Friday]
Spain's energy minister Teresa Ribera said EU energy ministers would meet on Friday to discuss setting a cap on Russian gas prices, adding that the European Commission had already circulated a number of proposals, including a price cap for gas delivered by Eu countries via pipeline or sea in Russia. A draft document seen by Reuters shows that ministers will consider various options, including a price cap on imported gas, a price cap on gas used for power generation, or a temporary exclusion of natural gas power plants from the EU's current electricity price-setting system.
[44 US dollars / barrel may become the "guide price" for the russian oil price limit measures]
U.S. Deputy Secretary of Finance Adeyemo said in an interview that the United States will set the initial "guidance price" for the oil limit measures against Russia at $44 / barrel, which is the previous estimate of the cost price per barrel of oil given by Russia itself. "We're not going to put prices below the cost of Russian production, and the $44 level will still encourage Russian oil production, but oil exporters won't be able to profit from the energy crisis they've caused," Adeyemo said. We aim to reduce Russia's oil revenues while allowing Russia to continue exporting energy. "As for how long the russian oil price cap will be maintained, and what the specific guidance price is, it will be decided by the coalition of countries participating in the program."
[Iraq's crude oil production in August was 67,000 bpd higher than in July]
Iraq produced 67,000 bpd more crude oil in August than in July, according to the National Oil Marketing Organization (SOMO), but exports from the south of the country continue to be hampered by delays in infrastructure upgrades. Data seen by Reuters showed that Iraq's crude oil production in August was 4.651 million bpd, meeting the target set out in the OPEC+ alliance agreement, but exports fell by 62,000 bpd, so the excess supply in August was loaded into storage units and internal consumption.
【U.S. stocks close lower on the first trading day after summer vacation, traders evaluate new economic data】
Major U.S. stock indexes closed lower on Tuesday, the first trading day after the U.S. Labor Day holiday and summer vacation, as markets traded on shocks as traders assessed new economic data.
A survey by the American Institute for Supply Management (ISM) showed that the U.S. service sector recovered for the second straight month in August due to order growth and strong employment, while supply bottlenecks and price pressures eased. However, S&P global data showed that the FINAL VALUE of the US Services Purchasing Managers' Index (PMI) in August was lower than its initial value.
Stronger-than-expected U.S. services data fueled expectations that the Fed would continue to raise interest rates to curb inflation. Carol Schleif, deputy chief investment officer at BMOFamilyOffice, said: "The Fed has made us very data-conscious, so after every piece of information comes out, investors not only have to look at the absolute level, but also try to infer what this means for the Fed meeting." "What makes investors uneasy is that there aren't many things that can really drive the market up or down steadily."
Concerns about Europe's energy supply and how the coronavirus lockdown will affect China's economy also drove the market down on Tuesday, said Shawn Cruz, chief trading strategist at TDAmeritrade, adding that "a lot of the uncertainty and volatility is not coming from the U.S., but actually from overseas."
The technology-based Nasdaq index fell for the seventh straight day, its longest decline since November 2016. Interest rate-sensitive Amazon and Microsoft both fell about 1 percent as benchmark U.S. Treasury yields rose to their highest since June. Apple, which will launch a new iPhone next Wednesday, fell 0.8 percent.
CmE's FedWatch tool shows traders see a 74 percent chance of a third consecutive 75 basis point rate hike at the Fed's policy meeting later this month. People will be watching Fed Chairman Jerome Powell's speech on Thursday, as well as next week's U.S. consumer price data, to look for clues to the path of monetary policy.
Stocks started weaker in September, continuing the downward trend that began at the end of August, when hawkish speeches by Fed policymakers and data highlighting the momentum of the U.S. economy raised fears of aggressive rate hikes. So far this year, the S&P 500 has fallen nearly 18 percent and the Nasdaq has fallen by more than 26 percent, with rising interest rates dealing a blow to big tech and growth stocks. Among the major segments of the S&P 500, energy stocks and communications services stocks performed the worst, while defensive utilities and real estate stocks climbed. The CBOE Market Volatility Index, known as the Wall Street Fear Index, closed at 26.91, having earlier hit a near two-month high of 27.80.
【Global covid-19 confirmed cases exceeded 603.16 million】
According to WHO's latest real-time statistics, as of 17:54 CET on September 6 (23:54 Beijing time on September 6), the global cumulative number of confirmed covid-19 cases 603164436, and the cumulative number of deaths 6482338. On the 6th, there were 378078 new confirmed cases of new coronary pneumonia in the world, and 1101 new deaths.
[48 cases of hepatitis infection of unknown cause have been detected in Spain]
According to the latest report released by the Spanish Ministry of Health on September 6, local time, between January 1 and August 31, 2022, a total of 48 cases of acute hepatitis infection in unexplained children were detected in Spain, and there was no epidemiological link between the above cases.
According to the report, the average age of hepatitis infection cases in children in the country is 5 years, of which 30 are females and 18 are males, and the infection cases include two newborns born only 3 days and 5 days old.
The report shows that a total of 3 unidentified cases of hepatitis infection in children in the country require liver transplantation, of which 2 have died and 27 cases have been cured and discharged after hospitalization.
Bullish factors affecting oil prices
[Ukraine says it shot down a number of Russian missiles]
Ukrainian President Zelenskiy said Ukrainian forces shot down five Russian cruise missiles on Tuesday, most of them in the south, but he did not mention that Ukrainian officials had earlier hinted at a new military success in the east. Reuters was unable to independently verify Zelenskiy's claims, and the Russian side did not respond immediately. U.N. Secretary-General António Guterres reiterated his call for the demilitarization of the area around the Russian-controlled Zaporizhia nuclear power plant in southern Ukraine, and on Tuesday proposed concrete steps for actions by both sides.
【"Nord Stream-1" equipment failure has the risk of explosion】
Gazprom (GAZ) said on September 5 that the failure of the Nord Stream-1 gas pipeline equipment carries the risk of fire and explosion.
Gazprom posted on social media on the same day that the Nord Stream-1 pipeline "Portovaya" compressor station is now a "hazardous operating facility" and could cause a fire or explosion if the hidden danger of continuing to run the oil-spilling turbines is not eliminated.
Gazprom said there had been similar oil spills before, but the problems had intensified and expanded. "The problem with multiple devices means it has a systemic character."
【U.S. service industry maintains growth momentum in August, price pressure eases】
U.S. services picked up for the second straight month in August due to order growth and strong employment, while supply bottlenecks and price pressures eased, reinforcing the view that the economy did not fall into recession, despite a decline in output in the first half of the year. The Institute for Supply Management (ISM) said the non-manufacturing activity index edged up to 56.9 last month from 56.7 in July, the second consecutive month of up after three months of decline.
Overall, the global central bank aggressive interest rate hikes and fuel demand prospects concerns overshadowed the impact of OPEC+ production cuts for the first time in two years, oil prices reversed the bullish trend, and $44 / barrel or will become the "guide price" for Russian oil price limit measures, will further suppress oil prices, before the relevant specific measures landed, the market or remain cautious, oil prices shocks are bearish.
This article originated from Huitong Network