News summary
Crude oil contract 2407 closed down, and the market was optimistic about a rebound in consumption. The Fed's hawkish remarks affect market sentiment, and geopolitical events may affect the oil market. Investors are concerned about the OPCE+ production reduction plan and inventory data, and crude oil may be volatile in the short term.
Newsletter text
[The crude oil market is facing shocks, and multiple factors affect price trends]
In Tuesday trading, the main contract of crude oil futures, 2407, recorded 0.scratchweb.92% fell and finally closed at US$612.60 a barrel.
The refinery's current profit level is low, and its operating conditions may inhibit the recovery of capacity in downstream industries. Although the crude oil market is currently in a low season for demand, the price split of gasoline and diesel shows slight signs of recovery. As the peak season approaches, the market is optimistic about consumer demand and expects a rebound.
Although the correction in inflation data eased slightlyscratchwebMarket expectations for interest rate cuts have been raised, but hawkish remarks by Fed officials may resurrect market concerns. FOMC Commissioner Bostick said that the U.S. neutral interest rate may be close to a ten-year high. His remarks led to an increase in the market's expected probability of raising interest rates in June from zero to 2%.
Recently, attacks on Russian refining facilities and ports have increased, and the crash of Iranian leaders may also have an impact on geopolitical stability.
With weak fundamentals, the market may continue to trade around the extension of the OPCE+ production reduction plan and the pace of the Federal Reserve's interest rate cuts, and crude oil may remain volatile in the short term. If demand in the peak season exceeds expectations, crude oil prices are expected to stabilize and show an upward trend. Investors should pay close attention to geopolitical developments and upcoming API and EIA inventory data.