International Crude Oil Prices Move Towards the 100 yuan, Domestic Oil Prices May Welcome Four Consecutive Rises

During the domestic Spring Festival holiday, the international oil price hit a new high since 2016 under many favorable conditions. Affected by this, at 24:00 on February 17, the domestic oil price is likely to rise, or usher in a "four consecutive rises".

Since February, international crude oil prices have been on the rise as a whole, with mostly positive fundamentals. U.S. crude oil once reached the $90/barrel mark.

Although the United States released some news that the Iran nuclear deal was about to be negotiated during the period, the bulls took the initiative to leave the market, and oil prices fell for a short time. However, with the decline in US oil inventories, international oil prices rebounded again.

As of the close on February 11, the price of light sweet crude oil futures for March delivery on the New York Mercantile Exchange rose $3.22 to close at $93.10 a barrel, an increase of 3.58%; the price of London Brent crude oil futures for April delivery rose $3.03, or 3.31%, to settle at $94.44 a barrel.

"On the whole, the international crude oil price is mainly volatile in this cycle, resulting in the domestic reference crude oil change rate always maintaining a positive and high fluctuation." said Wang Luqing, a refined oil analyst at Zhuochuang Information.

The change rate of crude oil monitored by the agency is 3.31%, and it is expected that gasoline and diesel will be increased by 145 CNY/ton.

According to the calculation of Jinlianchuang, as of the sixth working day on the 11th, the rate of change was 3.05%. The average price of reference oil types was US$90.58, and the domestic gasoline and diesel prices should be increased by 150 CNY/ton.

Jinlianchuang analyst Wang Shan believes that crude oil may be under pressure and shocks in the later period, but there are only 4 working days left before the price adjustment window.

Affected by inertia, the probability of this round of retail price increases is still relatively large, and it is estimated that the increase rate may be 100 CNY/tons or so.

Wang Luqing also believes that the current international oil market is strong in reality and weak in expectations.

It will take time to increase supply after the Iran nuclear deal is reached, and the current U.S. inventory is low and it is difficult to accumulate inventory, so international crude oil prices may continue to trend strongly.

The increase in the domestic retail price of refined oil on February 17 is a high-probability event. At that time, the domestic retail price of refined oil may achieve a "four consecutive rises".

Wang Shan analyzed that the sharp rise in crude oil during the Spring Festival holiday provided obvious support for the oil market.

In terms of supply and demand, affected by factors such as environmental protection inspections, the operating rate of local refineries continued to decline, and the output of refined oil products showed a tightening trend.

As the price adjustment window is approaching, it is a high probability event that the retail price realizes the "four times consecutive rises".