How to treat the first time in history rationally“Negative w88 casino Price”
（Source: "Economic Daily" 2020Year4month22日）
New York Stock Exchange, USAThe negative value of crude w88 casino futures prices in May is not only caused by the superposition of multiple factors under extreme circumstances, but also determined by the specific trading form of the futures market.
The phenomenon of "negative w88 casino prices" reflects the market's pessimism about the economic prospects. Although low w88 casino prices are beneficial to reducing my country's economic operating costs, they have a greater impact on the production, operations and profitability of central petroleum and petrochemical enterprises.
Local timeOn April 20, U.S. crude w88 casino futures prices plummeted. The price of its West Texas Intermediate crude w88 casino (WTI) futures May contract plunged more than 300% to close at -$37.63 per barrel. This is the first time since w88 casino futures began trading on the New York Mercantile Exchange in 1983 that they have fallen into negative territory.
w88 casino is the basic energy source, currently"Negative w88 casino prices" are a historic moment in any case, and how to rationally view and respond to them is of great importance. To this end, reporters from Economic Daily interviewed relevant experts.
Falling demand is the main reason
“This is determined by the specific trading form of the futures market and has a certain extreme nature.”Dong Xiucheng, researcher at the National Institute for Opening-up and Opening-up, w88 casino, and professor at the w88 casino of International Business and Economicssaid that there are two major groups of people in futures exchanges: one part is enterprises engaged in the real economy and use the futures market to carry out hedging transactions. The other part is financial institutions, which are not only engaged in investment, but also have a certain degree of speculation.
Currently, it has fallen sharply and closed in negative numbersWTI crude w88 casino May contract will be delivered on April 21, local time in the United States. The contract for delivery in May is about to expire, and traders are forced to close their positions to avoid buying spot crude w88 casino without inventory capacity, which puts pressure on w88 casino prices.
However, the current COVID-19 epidemic in the United States has caused a significant reduction in market demand, and early w88 casino inventories are almost saturated. U.S. Energy Information Administration (EIA) data shows that U.S. crude w88 casino inventories have increased for 12 consecutive weeks and have climbed to a new high in the past three years.
During the epidemic, it is said that dairy farmers in the United States have to dump milk at least every day14 tons of milk. However, crude w88 casino is different from products such as milk. The buyer must find an w88 casino storage warehouse to store it and cannot dispose of it at will, otherwise he will face high environmental fines.
“Therefore, when inventories surge and storage costs rise sharply, some financial institutions holding May contracts will close their positions at any cost, resulting in extreme ‘negative w88 casino prices.’” Dong Xiucheng said.
Expert analysis believes that,The extreme situation of the May crude w88 casino contract does not mean entering the era of "negative w88 casino prices". Data shows that although the June contract price of WTI fell by more than 15% that day, it still closed at around US$21/barrel, while the December contract was around US$30/barrel.
In other words,The negative price of crude w88 casino futures in May is caused by the superposition of multiple factors under extreme circumstances. The reference significance is limited. It is necessary to observe the trend of the main June contract in the future.
Is there a good opportunity to buy the dip?
Does the plummeting price mean a bargain-hunting opportunity?
Local timeOn the 20th, the United States announced that it would take advantage of the plummeting international w88 casino prices to purchase 75 million barrels of crude w88 casino to strengthen the U.S. strategic w88 casino reserves.
Dong Xiucheng said that China is a major w88 casino importer and is highly dependent on foreign w88 casino. From the perspective of balancing international expenditures and curbing inflation, the advantages of low w88 casino prices outweigh the disadvantages.
Data display,In 2019, my country's crude w88 casino import volume was 505.72 million tons, an increase of 9.5%, and its dependence on foreign w88 casino was as high as 70.8%. For this reason, since this year, when international w88 casino prices have been plummeting, it is a wise choice to drive a tanker to buy w88 casino abroad.
Lin Boqiang, director of the China Energy Policy Research Institute of Xiamen University, said that although bargain hunting is a good opportunity, the current practical problem is the need for sufficient storage equipment.
Dong Xiucheng also said that this extreme situation reflects the market's pessimism about the future.
Data shows that another global benchmark w88 casino price——Although the price of Brent crude w88 casino futures in Europe also fell by nearly 8%, the May contract was not negative, at around US$26 per barrel.
International Monetary Fund (IMF) The latest report predicts that the global economy will contract by 3% in 2020. OPEC's monthly w88 casino market report released last week predicts that global average daily w88 casino demand will fall by 6.85 million barrels in 2020. This will be the first annual decline in global w88 casino consumption since the 2008 international financial crisis; global w88 casino demand fell by 20 million barrels per day in April, the largest drop in history.
“However, if the international financial market is further turbulent, it will also have a certain impact on the Chinese economy.” Dong Xiucheng said that at present, we should pay close attention to the trends of global financial markets and remain sufficiently vigilant.
Domestic refined w88 casino prices will not be adjusted
What impact will international w88 casino prices have on domestic w88 casino companies if the international w88 casino price is so low?On April 20, Peng Huagang, spokesperson of the State-owned Assets Supervision and Administration Commission, stated at a press conference on the economic operations of central enterprises in the first quarter that although low w88 casino prices are beneficial to reducing my country’s economic operating costs, they will have a greater impact on the production, operation and efficiency of central petroleum and petrochemical enterprises, resulting in substantial profit reductions.
It is understood that in the first quarter due to the decline in domestic demand, my country’s refined w88 casino sales dropped by more than20%, the income cost of exploration, refining and other businesses has been inverted, resulting in overall losses for petroleum and petrochemical companies.
Relevant experts said that although most of my country's petroleum companies currently implement integrated operations, the decline in w88 casino prices has a greater impact on the upstream exploration business; at the same time, the costs of downstream refining and chemical products have also dropped, which can relatively balance the overall benefits. However, considering that the current chemical product market is not prosperous and the two-phase squeeze will still have a greater impact on petroleum companies.
Relatively speaking, PetroChina is most affected by the decline in w88 casino prices because of its large proportion of exploration business; CNOOC is second; Sinopec is slightly less affected because of its large downstream chemical business.
What impact will the downturn in international w88 casino prices have on the domestic refined w88 casino market? Can we buy ultra-low-price refined w88 casino at gas stations?
According to the "Petroleum Price Management Measures", the average price of international crude w88 casino to which my country's refined w88 casino prices are linked is lower thanWhen the "floor price" reaches US$40/barrel, domestic w88 casino prices will not be adjusted. The unadjusted portion will be turned over in full to the central treasury in accordance with regulations and will be included in general public budget management.
PreviousOn April 15, as the average international crude w88 casino price was lower than the "floor price" of US$40/barrel, there was no adjustment to domestic w88 casino prices. A new round of domestic refined w88 casino price adjustment window will open on April 28, and it is expected that this round will also trigger the protection mechanism without making adjustments.
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Xinhuanet: How long can negative crude w88 casino prices last? Let the experts explain it to you
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