The renewed epidemic in Europe has caused concern, countries have released oil reserves or landed, and oil prices have hit a seven-week low

During the Asian session on Monday (November 22), U.
S.
oil extended last week's decline, reaching a low of $74.
76 / barrel in nearly seven weeks; Investors weighed the possibility that major economies could release crude oil reserves to cool oil prices and that a surge in coronavirus cases in Europe could slow the economic recovery
.

During the day, the focus was on the annualized total of existing home sales in the United States in October, and the reports of countries on the release of crude oil reserves
.

Negative factors affecting oil prices

[Japan and the United States plan to issue joint statement on the release of the Strategic Petroleum Reserve]

According to the Yomiuri Shimbun, Japan and the United States could issue a joint statement as early as this week on the release of oil reserves to curb the rise
in oil prices.
Japanese Prime Minister Fumio Kishida said Saturday that his government was assessing possible measures to work with other countries to address the issue
.
Although Japan's oil reserve law does not allow the release of reserves because of high prices, reserves currently held by both the government and the private sector exceed the minimum requirements of the law
.
The Yomiuri Shimbun on Sunday, citing government sources, said the government was considering releasing some of these excess reserves and argued that the sale of these excess reserves was not restricted
by law.

Phil Flynn, senior analyst at Price Futures, said fears of the unknown are weighing on sentiment, with concerns that some form of coordinated release of oil reserves will be seen during next week's Thanksgiving holiday, when trading volumes are usually low, leading to a big rally
.

Goldman Sachs oil analysts said in a note that speculation about the release of the U.
S.
Strategic Petroleum Reserve has pushed oil prices down about $4 in recent weeks, and the market is already digesting an increase in supply of up to 100 million barrels
.
As a result, any release "can only provide a short-term solution
to structural shortages," the report said.
”

[S&P 500 index lower, cyclical stocks fall put pressure on the broader market]

U.
S.
stocks fell on Friday after hawkish comments from Fed officials and investor concerns that a new wave of the pandemic in Europe could trigger more
lockdowns.

Sectors in economically sensitive sectors such as energy, financials and industrials fell, the tech-heavy Nasdaq 100 outperformed major benchmarks and the U.
S.
Treasury yield curve flattened after two Fed governors said they might need to consider accelerating the pace
of tapering bond purchases given strong economic growth and rising inflation.

While stocks are hovering near record highs, supported by strong corporate earnings, a resurgence of the pandemic could halt economic recovery amid rising inflation, with Austria becoming the first Western European country to impose widespread anti-pandemic restrictions, parts of Germany have closed non-essential businesses, and the Netherlands has ordered shops and bars to close early
.

Callie Cox, senior investment strategist at Ally Invest, said: "This is another week for the stock market to defy gravity in a tough situation, and this road will not be easy
.
Investors are still digesting the risk of runaway inflation while confronting soaring Covid cases and a new round of restrictions in Europe
.
”

[Europe is once again at the center of the epidemic]

Europe is once again at the epicentre
of the pandemic.
Eastern Europe, Germany and Austria are especially the hardest hit areas
.
Austria has a relatively low vaccination rate, less than 70%.

The Czech Republic and Slovakia recently imposed restrictions on unvaccinated populations, while Latvia remained in full lockdown until last Monday
.
Coronavirus cases are rising every day in Italy, with the daily increase exceeding 10,000 this week for the first time
since May last year.

Austria will impose a nationwide lockdown starting on Monday, and Germany may consider similar actions
.
As restrictions on the unvaccinated failed to curb the increase in cases, Austria will become the first Western European country
to implement widespread restrictions.
To emerge from the crisis, the country will also become the first European country
to make a COVID vaccine mandatory.

Austrian Chancellor Alexander Schallenberg said that "too many of us are uneven-minded" and that "increasing vaccination rates is the only way to
break this vicious cycle.
"

Almost at the same time as Austria's announcement, Germany's top health official said that Germany may also need to step up its epidemic prevention efforts
.

Starting this week, the German state of Bavaria, which has the highest infection rate, will close clubs and bars, while shops will have to limit foot traffic and restaurants must close at
10 p.
m.
The local state government announced Friday that the hardest-hit neighborhoods will face tighter restrictions
.

While the latest restrictions are unlikely to tip the eurozone back into recession, they could slow the eurozone's rebound from the crisis and weigh on economic confidence
.
And the possibility of further pandemic measures will prevent the ECB from tightening monetary policy
too quickly.

[There may be 500,000 new crown deaths in Europe in March next year]

Hans Kruger, director of the WHO Regional Office for Europe, said in an interview with the media on the 20th that according to the current development of the new crown epidemic in Europe, if emergency epidemic prevention measures are not taken, 500,000 people in Europe may die of new crown pneumonia
by March next year.
Hans Krueger said that the tightening of the mask requirement could have an immediate effect
.
In addition, he mentioned "vaccine passports" as well as mandatory vaccinations
.
He believes that although mandatory vaccination is still controversial, it can still be used as a "last resort"
.

Separately, Iranian oil journalist Reza Zandi said Iran's oil minister said OPEC+ members Iran and Azerbaijan are considering finalizing a series of energy agreements "as soon as possible", including joint development of Caspian oil fields
.

Positive factors affecting oil prices

[Houthi propaganda attacks refinery positive for oil prices]

Yemen's Houthi attacked Saudi refineries and has not seen further information
on the attacks on the refineries.
According to reports, Yemen's Houthi forces said they used 4 drones to attack Saudi Aramco's oil refinery
in Jeddah.

However, at the same time, the Saudi side claimed to have shot down 4 drones and intercepted 2 missiles
.
According to CCTV news, the multinational coalition led by Saudi Arabia issued a notice on the afternoon of the 20th local time, saying that it shot down 4 drones carrying explosives and intercepted 2 ballistic missiles
within 24 hours.
Geopolitical tensions usually lead to a short-term rise in oil prices
.

Overall, this week, the market may usher in specific measures to suppress high oil prices to release crude oil reserves, coupled with the resurgence of the epidemic in Europe, countries have strengthened lockdowns, concerns about the epidemic have increased, oil prices are bearish and fundamentals are sufficient, oil prices may maintain a bearish tone, and are expected to fall to the 70 mark
.