The market continues to digest the news of EU sanctions against Russia International oil prices rose on June 1

As the market continued to digest the news of EU sanctions against Russian oil exports and Shanghai's full implementation of normalized management of epidemic prevention and control, international crude oil futures prices rose in the overnight market, rising in intraday volatility on the 1st, falling rapidly at the end of the day, and international oil prices rose
at the close.

Light crude futures for July delivery rose $0.
59, or 0.
51%,
to settle at $115.
26 a barrel on the New York Mercantile Exchange by the close of the day.
London Brent crude futures for August delivery rose $0.
69, or 0.
60%, to settle at $116.
29 a barrel
.

Bill Farren-Price, head of the macro research team at Enverus, a British energy service, said the EU's formal imposition of sanctions against Russia was a major event
.
If the EU comes close to achieving its target, Russia will lose an average of 3 million barrels per day in oil exports, which will not all be diverted to other markets, so there will be significant implications
.

Fitch Ratings said on the 1st that by the end of 2022, Russia's average daily oil exports may decrease by about 2 million to 3 million barrels, accounting for about a quarter
of the country's average daily oil production.
Due to infrastructure constraints, buyers' self-restrictions, and logistical problems, it may not be possible
to resell all Russian oil affected by sanctions to other markets.

The Extraordinary EU Summit took place
in Brussels on May 30-31.
European Council President Charles Michel said in a social media post late at night on the 30th that the leaders of EU member states reached an agreement on the sixth round of sanctions against Russia at a special summit, and will immediately ban the import of 75% of Russian oil, but temporarily make an exception
for oil supplied through pipelines.
According to reports, the EU will also gradually reduce oil imports from Russia by sea in the next six months, and oil products from Russia will gradually decrease
in the next eight months.

According to a number of media reports, at the OPEC+ Joint Technical Committee meeting held on the 1st, member states did not discuss the suspension
of Russia's implementation of production quota obligations.

Warren Patterson, head of commodity strategy at Commerzbank, said that if OPEC+ suspends Russia's obligations under the production cut agreement, it could open the door
for other OPEC+ members to increase production.
Still, given that most of the agreement members have consistently failed to meet their production quota targets in the past few months, it may be difficult for these producers to increase production
as a whole.

The OPEC+ Joint Technical Committee lowered its forecast for the size of the global oil market oversupply in 2022 by 500,000 b/d to 1.
4 million b/d
.

In addition, since June 1, Shanghai has fully implemented the normalized management of epidemic prevention and control, and fully restored the normal production and life order
of the city.
Market demand for Chinese oil products is expected to be boosted
.