The Positive Prospects For Sino-US Trade And The Weakening Of The US Dollar Continue To Provide Effective Support For Oil Prices

- Mar 07, 2019-

The positive prospects for Sino-US trade and the weakening of the US dollar continue to provide effective support for oil prices, but the economic slowdown has dragged down demand performance, coupled with higher-than-expected Iranian exports dragging oil prices. According to shipping data, Iran’s daily crude oil export volume has been around 1.25 million barrels since February. The average daily crude oil export volume in January was about 1.1 to 1.3 million barrels, both higher than market expectations. Some sources said that January Iranian crude oil exports were higher than expected, and even if the United States has begun to implement a second round of economic sanctions against Iran this month, Iranian crude oil exports are temporarily stable. After entering 2019, the high export of Iranian crude oil has limited the upside of international oil prices. On the other hand, high Iranian crude oil exports may trigger US economic sanctions. At the same time, the US crude oil export sanctions against Venezuela also provide effective support for oil prices. However, considering that the United States has provided import exemptions for eight countries and regions since the implementation of the second round of sanctions in November, the exemption period is only 180 days. Once the exemption expires, the sharp drop in Iranian crude oil exports may help the oil price to rise further.