U.S. oil is still under pressure of US$69, and this move by Saudi Arabia has caused the bulls to worry

In the European market on Monday (September 6), U.S. crude oil futures prices continued to be under pressure by US$69, and fell more than 1% during the session. Saudi Arabia, the world’s largest oil exporter, sharply lowered Asian crude oil prices over the weekend, twice the expected decline. The above shows that the world’s largest crude oil exporter hopes to attract buyers to increase imports, and highlights the ample supply in the global market. At this time, the market is worried about the rapid spread of the Delta new crown virus variant, and has raised concerns about the prospects of global fuel demand. .

As of press time, the US crude oil futures price was reported at 68.87 US dollars/barrel, down 0.61%, and the Brent crude oil futures price was reported at 72.19 US dollars/barrel, down 0.58%.



National oil giant Saudi Arabia’s National Petroleum Corporation informed customers in a statement on Sunday that it will lower the price of all crude oil grades sold to Asia by at least $1 per barrel in October. Asia is the largest purchase area for Saudi oil. According to a survey conducted by well-known foreign media on Asian refiners, the price cut is greater than expected.

With the new crown epidemic seriously affecting the recovery of energy demand, Saudi Aramco's official price increase for three consecutive months has made oil refiners feel uneasy. But because Brent crude oil has soared by 40% this year, the Organization of Petroleum Exporting Countries and its allies (OPEC+) believe that the demand is large enough and there may be a shortage by the end of the year, so production can be increased. Increasing production means more crude oil and competing for cautious buyers. If the monthly pricing is too high, Saudi Arabia, which sells all long-term contract crude oil to refiners, may alienate customers.

The August non-agricultural employment report released last Friday (September 3) was worse than expected, indicating that the economic recovery is uneven, which may mean that fuel demand may slow down when the epidemic breaks again. Crude oil futures last Friday Fell further.

Fearing that U.S. supplies would still be restricted after Hurricane Ida, the decline in oil prices was suppressed. According to foreign media reports, the death toll caused by Hurricane Ada is still on the rise. As of September 5 local time, the death toll in Louisiana was at least 13 people. Although Louisiana is doing its best to restore power, according to data from the PowerOutage website, at the time the report was released, 591,000 homes and business users in the state were still out of power.

Entergy, a major power company in southeastern Louisiana and southwest Mississippi, said on September 4 that "Ada" had damaged or destroyed 22,567 telephone poles, 26,729 wires and 5,261 transformers in these two states. At the same time, the oil production industry in the entire Gulf of Mexico is still paralyzed. As of September 5, 88% of crude oil production and 83% of natural gas production in the region were suspended.

The US government is releasing crude oil from the Strategic Petroleum Reserve. However, production in the Gulf of Mexico in the United States has not yet fully recovered. Government data released on Friday showed that about 1.7 million barrels of oil and 1.99 billion cubic feet of natural gas production capacity are still in a state of suspension, and power shortages are preventing some refineries from resuming operations.

Preliminary data from CME Group crude oil futures showed that the number of open positions in the crude oil futures market decreased by about 150 contracts last weekend. At the same time, crude oil futures trading volume has fallen the most since August 20, with approximately 246,500 contracts currently recorded.