The BOC crude oil ETF event will have a far-reaching impact and may change the structure of market participants. With the huge loss of BOC crude oil ETF, domestic supervision began to intervene. At present, the crude oil ETF products of major banks have been unable to open new positions, but for now, the enthusiasm of domestic investors for bargain-hunting has not subsided, and we believe that there will be some Investors turned to domestic crude oil futures. For external market, financial derivatives linked to on-market futures similar to crude oil ETF and USO ETF are the most important force of the current long positions, but with the closure of crude oil treasure and the sharp adjustment of USO positions, there is currently no buying in recent months, and the enthusiasm for investors in back-month contracts may be higher.
From a fundamental point of view, we believe that the June contract is still unsolved. Although OPEC will begin to reduce production from May 1, considering that it can only offset part of the decline in demand, the pattern of global accumulation in May cannot be reversed. The market is still continually approaching the storage limit. As long as the demand inflection point and the decline of inventory are not seen, the shadow of negative oil prices will be lingering. Therefore, for the moment, the pricing of recent month contracts mainly comes from the remaining storage capacity, while the remaining storage capacity continues to decrease, the oil price in the short term will face downward pressure. For the back-month contract, it is mainly the market’s expectation of demand recovery and the cost of the market’s marginal supply (mainly shale oil, which has a faster cycle of increasing and decreasing production), and The crude oil ETF event will cause investors to move their positions to the back-month contracts, thus changing the current structure of investor participants on different contracts.
In terms of futures operation, it is advised to maintain the short strategy; reverse cash and carry arbitrage strategy to long the back-month contract and short the nearby-month contract is recommended for WTI. Pay attention to the risks of epidemic under control and supply disruption caused by geopolitical events.
Overseas rubber retreated slightly. The main force contract of TF07 fell by 1.2 or 1.06% to 112.5. The main force contract of JRU09 fell by 2.0 or 1.32% to 150.0. The SHFE rubber fluctuated. The main force contract of RU09 fell by 65 or 0.65% and closed at 9,960, and the main force contract of NR06 rose by 5 or 0.06% and closed at 8,160. The quoted price for Qingdao rubber in USD fell by $5 to $15 per ton with general inquiries. The quoted price of RSS3 was $1,420 per ton. The spot price or CIF of STR20 was $1,140 per ton. The CIF of SMR20 in August was $1,180 per ton. The CIF of mixed rubber from Thailand in September was $1,215 per ton.
Gasgoo News: As automobile production around the world stalls and consumers stay at home to avoid the epidemic, the COVID-10 will continue to hit the global automobile industry. On April 22, IHS Markit lowered its forecast for global car sales. The agency expects that global new car sales will drop by 22% year-on-year to 70.3 million vehicles this year. In the global market, the largest decline will be in the US market, with sales dropping by 26.6% year-on-year to 12.5 million vehicles.
The drought in Thailand continues to alleviate. Heavy rains have been observed in Rayong Province recently. The cumulative rainfall in the past 3 months has increased from a year-on-year increase of 7% in the mid-month to 10% currently. According to data released by Zhuochuang, the domestic all-steel operating rate is 63.2%, down 1.1% week-on-week and 15.3% year-on-year. Affected by poor exports and the approaching May Day holiday, the operating rate is under pressure.
Futures Operation Advice: The main RU09 contract fluctuated like the trend of chemical futures; in terms of the long position, it is advised to set a stop at the previous low level at 9,780 below.
(For reference only)