Keep falling! Will international oil prices return to the 100 yuan mark?

Recently, international oil prices have continued to decline
.

Since the beginning of this year, international oil prices have been repeatedly adjusted, with twists and turns
.
Since the rapid rise of international oil prices to $100 per barrel at the beginning of the year, oil prices have continued to fluctuate upward, once breaking through the $120 per barrel mark
.

However, in recent years, due to the downturn of the global economy, the performance of the crude oil market has been sluggish, and international oil prices have returned to the $90 per barrel mark
.

International oil prices continue to fall, is the general trend gone? Will it return to the 100 yuan mark?

Supply tightness eased and oil prices fell

As of the close of trading on the 15th, the price of light crude oil futures for September delivery on the New York Mercantile Exchange fell $2.
68 to close at $89.
41 per barrel, and the price of London Brent crude oil futures for October delivery fell $3.
05 to close at $
95.
10 per barrel.

On the news, oil giant Saudi Aramco said on Sunday that if Aramco can produce oil at maximum capacity, continued investment in the oil industry is necessary, and Aramco can increase production to 12 million barrels
per day at any time.

In addition, in the early morning of the same day Beijing time, Iran said that it had issued an official response
to the draft text of the nuclear agreement proposed by the European Union.
Expert analysis pointed out that once the nuclear deal is resumed, Iranian oil export sanctions are lifted, and the tight supply of the global market caused by sanctions against Russia will also be eased
.

Fears of oil supply disruptions have eased due to factors such as Saudi Aramco's readiness to increase production, progress in the Iranian nuclear agreement, and the recent resumption of production of offshore drilling rigs in the US Gulf of Mexico and the extinguishing of fires at Cuban oil storage bases, which are expected to lead to lower oil prices on Monday
.

The global economy is in decline, and oil prices are under pressure

However, analyzing the deep-seated reasons for the recent continuous decline in international oil prices, the industry generally believes that this is mainly affected
by the market's concerns about the economic outlook.

Data showed that the US consumer price index (CPI) rose 8.
5% year-on-year in July, 0.
2 percentage points lower than expected and away from the high of 9.
1% set last month
.

The analysis believes that the significant slowdown in inflation in the United States, in addition to the Fed's sharp interest rate hikes, is significantly related
to the downward trend in energy prices under global recession fears.
Despite this, US inflation is still running at a high level, and considering that the core CPI has not decreased significantly, the possibility
of another rise in the US CPI in the later period is not excluded.

Affected by recession fears, OPEC and other institutions lowered their crude oil demand forecasts for this year, and OPEC's monthly report showed that the global crude oil demand growth rate in 2022 is forecast to be 3.
1 million barrels per day, compared with 3.
36 million barrels per day previously, further cooling
oil prices.

Seth Carpenter, chief global economist at Morgan Stanley (MS), recently wrote that the clouds of the global recession are gathering
.
The U.
S.
economy fell into a "technical recession" in the second quarter; And recession fears in the eurozone have intensified
.

In the context of the general decline of the global economy, international oil prices are facing greater upward resistance
.
At present, the tightening of monetary policy in many countries around the world is accelerating, the central bank has generally raised interest rates, the global recession expectation has increased, and investor concerns have aggravated the tension and volatility of the energy market, resulting in oil prices continuing to fluctuate
downward.

Can it return to the 100 yuan mark?

Despite the current decline in oil prices, overall, they remain firm
.
Expert analysis pointed out that recently, the "OPEC+" oil production increase is limited, G7 countries are still considering a global embargo on Russian oil, and the decline in US drilling data has formed a favorable support
for the international crude oil market.

Looking forward to the future market, can international oil prices return to the 100 yuan mark?

Data showed that US non-farm payrolls grew strongly in July and the unemployment rate was lower than expected; China's crude oil imports rebounded
in July.

"The improvement in some economic data has eased investors' fears
of a recession to some extent.
In addition, energy supply problems still exist, and Russia's supply through Ukrainian crude oil pipelines has supported oil prices
.
Han Zhengji, an oil analyst at Jinlianchuang crude oil, a commodity price monitor, said
.

But he also reminded that international oil prices are still at a low point in nearly 6 months, and investors' concerns about the poor demand outlook have not completely subsided
.
The downturn in the U.
S.
and Europe, as well as growing debt distress in emerging market economies, keep the outlook for energy demand cloudy
.

Haitong Futures pointed out that overall, the current position of oil prices lacks sustained upward momentum
.
On the macro front, although in the short term, due to some data showing economic resilience and the easing of inflationary pressures, the decline in interest rate hike expectations will help to enhance market risk appetite, it may swing at any time due to subsequent update factors, and the medium and long-term downward pressure on the economy and tightening liquidity will form continuous pressure
on commodity prices.

Despite this, Goldman Sachs remains bullish on future oil prices, saying that the current case for rising oil prices is still strong, and the market shortage is more serious
than expected in recent months.
Goldman Sachs expects Brent prices to rebound well above forward market levels, with its forecasts for the third and fourth quarters now at $
110 to $125 per barrel.