Institutional view: oil prices have continued downside risks

On June 1, the main SC crude oil contract fell by more than 2%. Everbright Futures Viewpoint: Data released by API showed that US crude oil and refined oil inventories increased last week. Crude inventories rose by about 5.2 million barrels in the week ended May 26. Gasoline inventories rose about 1.9 million and distillate stocks rose about 1.8 million. OPEC oil output fell in May after Saudi Arabia and other members of the OPEC alliance voluntarily cut production to support the market. The survey found that OPEC produced 28.01 million barrels per day this month, a decrease of 460,000 barrels per day from April, and the additional production cuts were less than expected. International oil prices have come under pressure from rising U.S. crude oil production and demand concerns over China’s economic data that fell short of market expectations. At present, the center of gravity of oil prices has dropped due to inertia, and the market is dominated by the decline in demand. In the short term, it is still necessary to pay attention to the dynamics of the OPEC+ meeting on the weekend. However, it is expected that production cuts may fall short of expectations, and oil prices may continue to fall.