Iranian Foreign Ministry spokesman Saeed Khatibzadeh said at a news conference that Iran and world powers reached an agreement to lift industrial sanctions, including energy, but did not explicitly mention oil.
Notably, the International Energy Agency said in its latest monthly report that Iranian crude oil production could rise to about 3.15 million barrels per day by the end of the year as negotiations to restart the Iranian nuclear deal continue. If a nuclear deal is reached, it could take another month to lift US sanctions, pushing up output and exports in the third quarter. Iran is likely to regain market share at competitive prices and will clear more than 75 million barrels of crude oil and condensate stocks stored on tankers as soon as possible. Iran's average oil exports this year are 660000 barrels per day, and sustainable crude oil production capacity could rise to 3.8 million barrels per day by mid-2022.
In addition, Saudi Crown Prince Mohamed Ben Salman had the opportunity this week to talk about long-term trends in the energy industry. On June 16, he will attend and deliver a speech at the Robin Hood investors' conference, which will bring together leading figures in the US hedge fund industry, including Paul Tudor Jones and Redario. Foreign media said that the Saudi Crown Prince will directly convey the bullish views on oil prices to these Wall Street giants this time.
Billionaire and legendary trader Tudor Jones told CNBC on Monday local time that he was closely watching the Fed's policy meeting this week, given recent economic data showing rising consumer prices. "these numbers are very important, and if the Fed is indifferent to these numbers, I think it gives the green light for inflation trading," Jones said in an interview. If they say,'We are on the right track and things are fine, 'then I will bet on (all in) inflation trading with all my strength. " "I might buy commodities, buy cryptocurrencies, or buy gold," Jones added. "
Starting as a cotton trader, Tudor Jones first rose to fame in 1987, specializing in macro trading such as interest rates and foreign exchange. Today, he manages more than $18 billion in assets, and Tudor B.V.I. Global Fund, founded in 1986, has earned an average annualized return of about 23% since its inception.
On June 14, local time, British Prime Minister Johnson announced that the release date of epidemic control in England would be postponed for four weeks, that is, from June 21 to July 19. Some media analysts said that the news of Britain's extension of the blockade reduced the market's optimistic expectations of a strong rebound in demand from western countries in the summer.
Yesterday afternoon, European stocks opened higher across the board, Germany's DAX index hit a new all-time high, the UK FTSE 100 index refreshed its highest level since February 2020, technology stocks in the European Stoxx600 index led the rise, almost all sectors were able to rise. As of last night's close, the pan-European stock index hit a record high for the seventh day in a row, but the auto sector led the decline against the market, with only the German stock index closing lower among European countries.
In terms of oil prices, US oil cloth oil continued to rise last night, hitting intraday highs of more than two and a half years and two years, respectively, but as the UK unsealed extended, oil prices fell back in intraday trading. Finally, WTI July crude oil futures closed down 0.04%, Brent August crude oil futures closed up 0.23%, the second day in a row since April 30, 2019, the closing high of the main contract.
Is the return of Iranian crude oil imminent?
Yesterday, the Iranian Foreign Ministry spokesman's statement aroused concern. In this regard, Citic Futures analyst Yang Jiaming told Futures Daily that the outcome of Iran's nuclear negotiations is certain, but the path is tortuous. The main reason is that Iran has asked the United States to lift all sanctions under the Trump administration, but the Trump administration has adopted some sanctions through congressional legislation, and it will take a long time for the Biden administration to lift them. In addition, the Biden administration also wants to use extreme pressure to continue to suppress Iran. But there is also good news that the Biden administration has lifted sanctions on more than a dozen former Iranian officials and energy companies, a move that comes at a time when Iran's nuclear talks are deadlocked. Us officials say Washington has promised a broader relaxation of sanctions if Tehran changes its behaviour. This is also seen as a sign of the Biden administration's overtures.
"generally speaking, the market believes that the negotiations will continue to repeat, if the United States does not lift sanctions, it will be difficult for Iranian crude oil to return to the market in the short term, and market worries about the outcome of the negotiations will lead to The six rounds of negotiations have shown that although the process is tortuous, the two sides are more sincere and it is expected that there may be a result in September. " Yang Jiaming said
Yang an, a futures analyst at Haitong, believes that the current market has a rapid response to Iran's negative, but the lethality of the negative is variable after the stress reaction, because the market still believes that strong demand and OPEC+ efforts will digest the impact of the return of Iranian crude oil, and the recovery of Iranian oil exports is not expected until the autumn. Although there is excess capacity in both upstream OPEC+ producing countries and downstream refining capacity, the supply increment of OPEC+ is still expected to lag behind the demand increment.
The fundamentals of crude oil continue to improve.
In terms of crude oil demand, according to Li Yunxu, a crude oil researcher at CIC Anxin Futures, the new diagnosis of the global novel coronavirus epidemic continues to decline in a single day, which is significantly lower than in early May. Travel intensity in Europe and the United States continues to improve, and oil sales are expected to stop falling significantly in June. In addition, in the past two weeks, the number of flights around the world, the number of security checks at US airports and the apparent demand for EIA US aviation coal have all reached the highest level since the epidemic. Generally speaking, the accelerated rebound in oil demand brought about by the improvement of the epidemic in Europe and the United States has entered the empirical period, and it is expected that lagging indicators such as the operation rate of European refineries will increase significantly in the later stage.
On the supply side, last week's OPEC+ ministerial meeting decided to retain the previous agreement to continue to increase production in July, and the next ministerial meeting will be held on July 1. It is worth noting that the Saudi energy minister said that the OPEC+ did not discuss Iran's return to the oil market, but would not ignore it, and that the OPEC+ remained committed to the April 2020 Declaration of Cooperation. We can see that OPEC+ is still committed to balancing global crude oil inventories and a reasonable range of oil prices, but as the current market expectations for the progress of OPEC+ production from May to July are relatively sufficient, the extent and pace of production increase are designed to match the demand side, so it is difficult to form a long-short drive. Iran's production expectations in the second half of the year and the resulting adjustment of OPEC+ production reduction policy and implementation rate will become the main concern of the supply side at present. " Li Yunxu said.
Will oil prices remain strong after the Dragon Boat Festival?
Oil prices fluctuated strongly before the Dragon Boat Festival, with WTI crude up 4.14% and Brent crude up 4.61%, which was up 3.19% at Friday afternoon's close.
Referring to the trend of post-holiday oil prices, Li Yunxu said that the accelerated recovery of global oil demand has entered an empirical period, and market expectations for the return of Iranian crude oil have been relatively fully traded, but there are still differences on the pace of production release brought about by the details of the final agreement. At present, the return rhythm of Iranian production is uncertain, and the regulation policies of OPEC+ for production in the second half of the year may be issued within a month, the short-term supply side may face greater risks, and the profit-loss ratio of unilateral strategy may be relatively limited, so caution is recommended.
"fuel oil has recently followed the crude oil oscillation, and the supply margin of high-sulfur resources is loose in the context of increasing production in the Middle East, but the regulation of domestic imported crude oil is tightening, and the demand for deep processing of fuel oil in local refineries may increase. The domestic bonded market for low-sulfur fuel oil is affected by the competition for the share of domestic resources, and the internal and external price difference may continue to be under pressure. in the later stage, if the diesel cracking price difference remains strong, it is expected to divert the supply of low-sulfur fuel oil and form marginal benefits to LU. It is recommended to carefully hold LU-FU arbitrage orders. " Li Yunxu said.
Yang Jiaming suggested to focus on the Fed's statement, the recent continued accumulation of oil products in the United States, and the suppression of crude oil demand by the tightening of domestic crude oil quotas in the second half of the year: "US inflation exceeds expectations and the market waits for the Federal Reserve to declare its position. From the perspective of downward US Treasury yields, the market may agree with the Fed's view that inflation expectations will gradually decline, but expectations of tightening liquidity in the future need to be vigilant."
