Due to factors such as reduced oil supply and better demand prospects, international oil prices, which fell into negative values in April, have continued to rebound in the near future, and oil prices in New York rose nearly 90% in May. However, novel coronavirus pneumonia is still facing the risk of callback because of the uncertainties of the new crown pneumonia epidemic situation and the policy of oil production reduction.
U.S. crude oil production also fell sharply. In the week ending may 22, the average U.S. crude oil production was 11.4 million barrels a day, up from a record high of 13.1 million barrels in the first half of March, according to the latest data from the U.S. energy information administration.
Some institutions predict that the international crude oil market may achieve a balance between supply and demand in the middle of this year, and then enter the stage of tight supply and de stocking, which means that the oil price will be further supported. However, some analysts believe that the current rebound of international oil price is mainly supported by the reduction of supply, the oil price is still fragile, and under the influence of uncertain factors such as the epidemic situation and the policies of oil producing countries, it still faces the risk of callback in the future.
Jason gummer, an analyst at Jeffrey group, an investment bank in the US, said that if oil producing countries do not cut production due to the recovery of oil prices, the current momentum of oil prices will be at risk. JBC energy Austria also believes that at the current price level, many shut-down wells will be put back into production.
OPEC and non OPEC oil producing countries will hold a remote ministerial meeting in June to discuss production reduction policies in the second half of this year. Analysts believe that if OPEC and non OPEC oil producers decide not to extend the current production reduction to the second half of the year, the market may be shaken by concerns about oversupply.