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New York WTI crude oil futures, that is, the May contract of West Texas light crude oil futures in the United States will expire today. What impact does the current negative oil price situation have on the domestic crude oil market? How big is the impact?
"Negative oil price" has a geometric impact on China
Market agencies said that because the May contract is about to expire and is no longer an active contract, the negative oil price does not accurately reflect the current oil price. This can only be regarded as a temporary price anomaly, and it will not be affected by negative oil prices for the current domestic refined oil pricing.
Jin Jingyuan, senior analyst of Jinlianchuang Energy Department: Our domestic refined oil pricing mechanism adopts the main contract of futures. At this stage, taking WTI and Brent as examples, both adopt the June contract of futures contracts, so The impact of the pricing mechanism and the price adjustment range have no substantial impact.
In addition, our pricing mechanism has implemented a policy of $ 40 floor prices in mid-March, so there will be no huge changes in terminal oil prices for the time being.
The data shows that China's crude oil is about 70% dependent on foreign countries. Most imported crude oil types are mainly Middle East and Russian oil. These oil types are priced in Dubai and Brent respectively. During the period of low oil prices, from the perspective of import data, 1- In March, China's crude oil imports rose 4.9% year-on-year.
Jin Jingyuan, a senior analyst at Jinlianchuang Energy Department, said that WTI is more of a benchmarking function in the pricing mechanism, so its pricing ratio is not very large and should be around 20%.
Lu Jianzhong, vice president of China Petroleum Economic and Technological Research Institute: WTI price is a price in North America. It has always been lower than the price of Brent oil. It is restricted by regional markets, and global liquidity is relatively poor. Negative oil prices are actually an extreme phenomenon of the rules of the game in the oil futures trading market, and cannot represent the supply and demand relationship in the world or other regions.
Our country as a whole is a major oil and gas consumer and importer, but now our own reserve capacity is limited, and the global reserve capacity is also very limited, we should create conditions to increase oil reserves, including strategic reserves and commercial reserves, to respond to future changes.
How to trade "negative oil prices"?
Can't sell negative oil prices? How to buy and sell negative futures prices?
Experts comprehensively said: First, the negative oil price can not be sold. Because oil is a dangerous chemical, it is not like milk beer. The excess can be dumped. Its rigidity is particularly strong, and it has safety and explosion-proof management requirements. Therefore, if more oil is produced, if the money is not poured, the traders will take it away. Failure to store will cause a security accident. Therefore, not selling is not acceptable.
Second, futures trading is a contract. Normally, when the price falls to zero, the transaction is over. Recently, the New York Mercantile Exchange has deliberately modified the software system to make negative oil price trading possible, and canceled the fuse mechanism. This practice is actually encouraging large fluctuations in oil prices, attracting more speculative funds for exchanges, and earning various fees such as membership fees, deposits, and liquidation fees. This approach has indeed attracted global attention, laying the groundwork for the next round of dramatic oil price fluctuations.
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