The long-short logic rotates, and the oil price shuttles up and down

• Price performance: On Friday (February 24), international oil prices rose for the second consecutive trading day, although higher-than-expected U.S. crude oil inventories continued to challenge the outlook for oil demand, but Russian output Lower expectations are offsetting.
• Crude oil prices continue to fluctuate:

Since the beginning of the year, the price of Brent crude oil has experienced four rounds of shocks in the range of 80-90 US dollars / barrel. In early January, China's demand expectations and financial sentiment improved, supporting a sharp increase in oil prices. In late January, U.S. and European oil products continued to accumulate, and now oil prices rose and then fell back. In early February, the European Union imposed sanctions on Russian refined oil products, and Russia announced to cut production in March, pushing up oil prices again. In late February, Biden announced that he would sell reserves in March in response to Russia's production cuts. The higher-than-expected U.S. inflation data raised the Fed's interest rate hike expectations, causing oil prices to fall back to the lower edge of the range again.

• Oil price long-short logic analysis:

①Geographic perspective: The support mainly comes from OPEC's annual production cuts, Russia's initiative to cut production, and other short-term supply disruptions. The pressure mainly comes from Biden's still strong willingness to suppress oil prices.

②From the perspective of financial attributes: the recovery of China's economy is positive for financial sentiment, and the slowdown of overseas economies puts pressure on financial sentiment.

③ From the perspective of supply and demand attributes: the supply side provides upward momentum for oil prices, and the demand side is the main downward pressure on oil prices.

• Oil price outlook---- Long and short cycles drive oil prices to fluctuate

①In the short term: Saudi Arabia and Russia cut production, providing support for oil prices from the supply side. However, due to the status quo of inventory accumulation, the upper space is temporarily limited. The short-term focus on high inflation makes the Fed may change the pace of interest rate hikes, which has an impact on financial sentiment.

② In the medium term: In the first half of the year, the fundamental drivers are weak at first and then strong. If demand expectations are fulfilled and oil products are shifted from storage accumulation to destocking, the center of crude oil prices is expected to rise.

③ In the long run: The expectation of wide fluctuations at US$70-100/barrel will be maintained for the whole year. The US$70 is supported by the repurchase price range of the US strategic inventory, and the US$100 is supported by the important integer mark under the general trend of economic growth slowing down.