U.S. crude oil and gasoline inventories have increased more than expected International oil prices may come under pressure in the medium term

On the evening of August 3, Beijing time, EIA (U.
S.
Energy Information Administration) released the latest data showing that the US gasoline consumer demand weakened, while crude oil and gasoline inventories increased
more than expected.

On the same day, the OPEC+ meeting decided to slightly increase the September production quota by 100,000 barrels per day, far below the previous market consensus expectation of 300,000 barrels per day to 400,000 barrels per day
.

Picture says: A slight increase in the September production quota of 100,000 barrels / day Image source: OPEC official website

Guotai Junan Futures said that the results of the meeting were relatively neutral, and there was no unexpected supply reduction, which was limited
to the boost to oil prices.
At present, the market's expectations for overseas economic recession have not yet been reversed, considering that the recent CPI data of overseas economies, service industry data and other macro indicators reflect the slowdown of economic momentum, the superimposed tightening cycle continues to advance, and the international oil price is likely
to be under pressure in the medium term.

According to the latest EIA data, gasoline demand in the United States fell by 12.
6% in the week of July 29 compared with the same period last year, down 700,000 barrels per day from the previous month to 8.
54 million barrels per day, falling below the previous epidemic level, and the four-week average also fell by about 9%
year-on-year.
At the same time, crude oil and gasoline inventories increased more than market expectations
.
Commercial crude oil inventories were up 4.
467 million barrels from the previous week, and gasoline inventories were up 163,000 barrels
.

Mizuho analyst Jacob said, "Summer should have been the peak season for gasoline consumption, and the current accumulation phenomenon is a very negative signal
.
" ”

U.
S.
gasoline inventories increased more than expected in the week of July 29 Image source: EIA's official website

At the same time, the small increase in OPEC+ production has maintained the expectation of the crude oil supply side, and its announcement said that the main reason for limiting OPEC production is insufficient long-term investment in the crude oil field, and the actual effective capacity of OPEC is insufficient, not a matter of
production willingness.
Industry analysts said that OPEC is reluctant to overdraft the remaining remaining capacity, on the one hand, in order to cope with the possible sudden supply interruption, on the other hand, because September to October will usher in the peak of global refinery maintenance, when demand will appear seasonal decline, at this time a sharp increase in production is not wise
.

CITIC Futures said that in the absence of a significant increase in OPEC, the current key factors affecting international oil prices have shifted from the supply side to the demand side
.
Recently, due to the continuous decline in overseas economic growth, the acceleration of tightening by the US and European central banks, the expected recession may drag down oil prices, and at the same time, due to the impact of the epidemic, the traffic flow in the United States and Europe has declined, and short-term transportation demand has also been under pressure, and multiple factors have led to a significant slowdown
in overseas oil demand.
International oil prices are still facing greater downward pressure
in the medium term.

It is worth noting that the US Markit service PMI data has continued to decline since March, and the latest July data also fell below the boom-bust line, recording 47.
3
.
According to the PMI report, the current consumption demand of American residents is showing a significant downward trend, and under the influence of high prices, travel, tourism and other activities have obvious inhibition effects, which also confirms the above view
.

Under the influence of the above factors, international oil prices also fluctuated
greatly on August 3.
Before the EIA released the data, international oil prices rose by more than 2% intraday, but after the data on the increase in U.
S.
oil inventories exceeding expectations and falling demand was released, oil prices fell
rapidly.
Wind data showed that the day's WTI crude oil futures closed at $90.
66/bbl, down 3.
98%.

Brent crude futures closed at $96.
78/bbl, down 3.
74%.