On the supply side, although OPEC+ has a production increase plan, there are differences in the implementation efforts among member states. Some countries may be unable to fully implement the production increase target due to their own interests or production capacity limitations. In the case of U.S. shale oil, the current oil price is hovering near $60, close to the shale oil extraction cost line. If oil prices continue to fall, the production enthusiasm of U.S. shale oil enterprises will be dampened, and some oil wells may even be shut down, leading to a reduction in supply, which in turn will support oil prices.
On the demand side, the global economic recovery trend has gradually become clear. With the continuous implementation of economic stimulus policies by various countries, industrial production activities have increased, and the transportation industry has gradually recovered, leading to a steady growth trend in crude oil demand. In particular, emerging economies, with their fast economic growth rates and large demand gap for crude oil, have become an important force driving the growth of crude oil demand.
Geopolitical factors remain a key variable affecting oil prices. The situation in the Middle East is tense, the progress of the Iranian nuclear negotiations is slow, and the contradictions between Israel and Iran continue to escalate. Once a conflict breaks out, it will seriously affect crude oil production and transportation in the Middle East, leading to a global crude oil supply shortage and a inevitable sharp rise in oil prices.
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