International oil prices have fallen below the $80 per barrel mark, and institutions suggest that "futures+options" do a good job in risk management
2023-11-09
On November 8th, Beijing time, the WTI crude oil futures price fluctuated below the $80/barrel level, and with the linkage between internal and external markets, Shanghai crude oil also approached the 600 yuan/barrel level. The main contract 2312 futures price closed at 607.9 yuan/barrel, a decrease of 4.87%, setting a new low in nearly three months. Multiple institutions have told Securities Daily reporters that due to the rapid changes in gold prices, short-term risks of related industrial enterprises have rapidly increased. Based on risk management needs, futures and options tools can be considered to protect profits. Wang Ying, a researcher at Zhongyan Futures Investment Consulting Department, told Securities Daily that the decline in international oil prices is mainly due to the lower than expected recovery of overseas economies, such as the US unemployment rate exceeding expectations in the past two months and the accelerated contraction of the new order index. Meanwhile, there have been no signs of tightening on the supply side. In the long run, the supply and demand pattern is in a relatively loose state, but in the short term, there may be a possibility of production reduction on the supply side, and there may be some support for prices. The decline in international oil prices is a reflection of the expected decline in global demand, "Song Huaibing, director of the Anliang Futures Research Institute, told reporters. The WTI crude oil trading target is medium crude oil from West Texas, USA. According to the latest institutional holdings released by the US Commodity Futures Trading Commission (CFTC), the total WTI crude oil holdings have continued to decline since October; Among them, non commercial short positions continue to increase, while non commercial long positions continue to decrease, leading to a decline in speculative net long positions and a decline in futures prices from high levels. According to data on the official website of the Shanghai Futures Exchange, based on the position holdings of the top 20 futures companies in the main fuel oil futures contract 2401 on November 8th, the short positions are much higher than the long positions, approaching 180000 positions, with a daily increase of 18900 positions. Among them, Haitong Futures, Huawen Futures, and CITIC Futures have all increased their short positions by over 1000 positions. However, short positions in positions such as Yong'an Futures and Bank of China Futures continue to decline. Entering the fourth quarter, the logic of crude oil trading in the market is changing. Li Zhenyu, a researcher on non-ferrous metals at Dayou Futures, analyzed that the current dominant factor in international oil price fluctuations lies in geopolitical risks. Due to the significant decline in international oil prices, short-term risks have intensified, bringing operational risks to oil related enterprises. The current crude oil futures price fluctuates greatly, and enterprises can hedge based on spot prices and comprehensively consider the benefits and profits of the enterprise, "said Wang Ying. Oil related enterprises include production enterprises and consumer enterprises. In the view of Song Huaibing, the crude oil industry chain is long, and a complete and mature hedging or arbitrage plan can effectively enhance risk resistance. For local refineries, the focus should be on inventory preservation in the near future, or reducing inventory to avoid the risk of inventory depreciation caused by the decline in crude oil prices; Meanwhile, the downward risk of refined oil prices may affect the profits of local refineries, which can be addressed through futures and options tools. Li Zhenyu also stated that in the context of international crude oil prices breaking through and falling, upstream mining and storage companies should actively respond to risks and use derivative tools for hedging is the best choice. Through reasonable risk management and hedging strategies, enterprises can maintain relatively stable operations amidst fluctuations in oil prices. (New News Agency)
Edit：Hou Wenzhe Responsible editor：WeiZe
Source：Securities Daily
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