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SunSirs: The Supply Pressure still Exists, Fuel Oil Market is under Pressure

May 28 2020 11:29:23     SunSirs (Selena)

Futures: fuel oil fell Wednesday, closing 1,628 (down 32), adding more than 30,000 positions and increasing trading volume. Short positions increase in a decentralized way and individual positions decrease in a centralized way, with large increase in positions and stronger concentration. Europe, the United States and other countries restart their economies, the demand for crude oil is gradually picking up, and the oil price is surging. We are concerned about whether the production reduction agreement can be implemented as planned. Night market short position active increase pressure, after the market down shock adjustment, high selling pressure increased. In short term or continuous pressure bearing weak fluctuation of fuel oil, attention shall be paid to international news, epidemic 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. Europe and the United States relax restrictions and gradually return to work. After the sharp rebound in oil prices, the monthly gap has narrowed. The increase in the demand for oil reserves has led to the increase in freight rates, which supports the long-term internal and external price differences of fuel contracts. Crude oil continued to pull up after the market sentiment cooled, speculative capital market volatility. The worst stage of crude oil demand has passed, but it still needs to recover for a long time; if the accumulated reservoir pressure picks up, the oil price has the risk of further exploration; if the epidemic situation is completely controlled and the economy returns to normal, the oil price is expected to continue to rise.


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