SunSirs: China Domestic SC Crude Oil Futures Plummeted on December 13

Analysis: On Tuesday, international crude oil fell nearly 4% overnight. The settlement price of the main WTI crude oil futures contract in the United States was $68.61 per barrel, a decrease of $2.71 or 3.8%. The settlement price of Brent crude oil futures main contract was 73.24 yuan/barrel, a decrease of 2.79 US dollars or 3.7%. Oil prices have reached a six-month low. On December 13th, the domestic crude oil market fell along with the settlement of the main contract for SC crude oil at 533.5 yuan/barrel, a decrease of 3.0%. The main reason for the unexpected increase in US CPI data released on Tuesday and the rebound in inflation have lowered market expectations for the Federal Reserve's interest rate cut early next year; Overlapping market concerns about oversupply.

Prediction: Currently, crude oil faces dual pressures from both macro and supply and demand sides. As inflation warms up, the future policy choices of the Federal Reserve may become narrower, and the duration of maintaining high interest rates may be extended, which will bring pressure to the oil market in the medium to long term. In the short term, the supply-demand game will continue to play a role, and the supply side still needs to pay attention to further OPEC's production reduction actions in the future. In addition, although US crude oil production is at a high level, its future growth space is also limited due to capital expenditure restrictions. The sluggish demand outlook will dilute the effectiveness of OPEC's production control. At present, the market is waiting for the energy outlook reports from OPEC and the International Energy Agency (IEA) to be released next week, and there is a demand for adjustment in the oil market this week. Overall, the oil market may remain weak in the near future or continue to seek downward space.

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