Crude Oil Plunges 5%, Dips Below $100

International crude oil prices have suddenly plummeted, breaking below $100, with the lowest point reaching just $95, a drop of nearly 5%.

A few days ago, the United States announced the largest release of strategic petroleum reserves in its history, which had already led to a decline in oil prices, and this time, the International Energy Agency (IEA) has also joined in, so crude oil prices have broken downward once again.

In addition, the increase in U.S. crude oil inventories and the upcoming increase in supply by several energy giants have also become bearish news. It seems that the prices will have to fall back down the same way they rose up.

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Last night, the International Energy Agency announced that it will release 120 million barrels of oil reserves, and its member countries have agreed to this decision, with the United States releasing 60 million barrels.

The fundamental purpose of this move is to cool down oil prices, at least returning to the price levels before the European conflict, to avoid the continuous rise in inflation in Europe and the United States, affecting the global economy.

Looking back at the historical data of the International Energy Agency, this is the largest release of strategic energy to the market in 47 years.

However, the 60 million barrels contributed by the United States is not new, but is included in the 180 million barrels previously announced by the United States, so in fact, the news from the International Energy Agency this time has added 60 million barrels of crude oil reserves to the market, which means that although this news is encouraging, there is still some水分.

Last week, the United States took a step ahead and decided to release 180 million barrels of strategic petroleum reserves to the market over the next six months, at a rate of 1 million barrels per day, which is also the largest release by the United States since 1974.At present, the United States has only 570 million barrels of oil reserves. If 180 million barrels are released as planned in the next six months, the U.S. strategic oil reserves will drop to a 40-year low, a level not seen since 1984.

However, the latest data shows that U.S. crude oil inventories unexpectedly increased last week, adding 2.4 million barrels from the previous week. The market had expected a decrease of 2.1 million barrels. This marks the second consecutive week of rising U.S. crude oil production, which has now increased by 100,000 barrels per day to 11.8 million barrels, the highest level since December last year.

Affected by this information, crude oil prices fell by more than 6% at one point yesterday, and closed down nearly 5%. Although they did not break through the recent low, the distance is not far. The decline in Brent oil prices in the London market was also nearly 5%.

Another piece of news involves some energy giants. The U.S. House of Representatives questioned the CEOs of six companies, including Shell, ExxonMobil, Chevron, and BP. The reason is that the U.S. is dissatisfied with these companies maintaining low crude oil production for a long time to push up crude oil prices and obtain higher profits. Ordinary consumers are paying the bill, and it also leads to higher and higher inflation data in the United States.

It is believed that in the near future, these energy giants will increase production to varying degrees, which will also have a significant impact on the decline in crude oil prices.

The market now generally believes that the current crude oil supply and demand can still be maintained at a balanced level. The impact on oil prices comes more from expectations for the future. Everyone is worried that the European conflict will lead to a reduction in crude oil supply. If the relevant companies increase production, it will help to reverse market expectations.

Before the outbreak of the conflict in Europe, international oil prices slowly rose from $75 at the beginning of the year to $90. Now it seems that oil prices will gradually fall back in the near future and return to this range.