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SunSirs: Energy, EIA Inventory Fell, Fuel Oil Market Continued to Rise

May 22 2020 10:53:53     SunSirs (Selena)

Futures: fuel oil rose on Thursday, closing 1,676 (up 32), adding more than 10,000 positions and trading volume slightly decreased. Europe and the United States gradually restart the economy, Saudi Arabia plans to increase the intensity of production reduction, crude oil demand gradually picked up, market sentiment has improved, the low oil price gradually rebounded, and the monthly gap narrowed. After the night high opening, the long positions increased actively, the market was highly volatile, and some short positions reduced in the day supported the price. Short term or strong fluctuation of fuel oil, pay attention to international news, COVID-19 development and market sentiment change.

Strategy analysis: at present, the epidemic center of COVID-19 has shifted from Europe and the United States to emerging market countries, and all 50 states in the United States have started to ease restrictions on resumption of work. After the sharp rebound of oil price, the monthly difference narrowed, and the increase of oil storage demand led to the rise of freight rates, supporting the forward price difference between internal and external prices of fuel contracts. From July 3, the previous exchange increased the storage fee of futures fuel oil from 1.4 RMB/ton/day to 3 RMB/ton/day, and the contract price difference between the far and the month widened. Iron ore shipments from Brazil and Australia fell on a month on month basis, while the demand for fuel oil processing in India was strong. The worst stage of crude oil demand has passed, but it still needs to be recovered for a long time; if the accumulated reservoir pressure picks up, the oil price has the risk of further exploration, and the market may fluctuate widely.


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