Transmission Oil Project Was Priced at $100.59 on Wednesday

On January 19th, Beijing time, on Wednesday morning, some media reported that the cornerstone XL crude oil pipeline project that planned to reach the Gulf of Mexico from the US and Canada borders had been rejected by the Obama administration. Crude oil prices subsequently declined; however, the project will be approved. News of the redesigned route also helped to narrow some of the decline in oil prices. The main crude oil contract finally closed at US$100.59 per barrel.

On the New York Mercantile Exchange, the main crude oil contract in February fell 12 cents on Wednesday to close at 100.59 US dollars a barrel, a decrease of 0.1%. The contract earlier fell to $99.84 a barrel.

Although the International Energy Agency made a lower forecast for global energy product demand in its earlier report, the price of oil still showed a tendency to open higher. The fall in the exchange rate of the U.S. dollar and the relatively good U.S. industrial output data provided sufficient support for earlier crude oil prices.

Media reports on Wednesday said that the Obama administration will soon announce its veto decision on pipeline pipeline operator Pan-Canada's cornerstone pipeline program. This pipeline was once regarded as one of the solutions to solve the bottleneck problem of crude oil supply in Cushing, Oklahoma. Cushing is also the delivery point of the New York oil contract. The pipeline was originally expected to deliver crude oil from Canada's bitumen sands and crude oil near the U.S. and Canada borders to refineries near the Gulf of Mexico. The Gulf of Mexico is also at the heart of the US oil refining industry.

Some analysts pointed out that importing more oil from Canada means that the United States can reduce its dependence on oil in the Middle East. However, the cornerstone XL pipeline project was also strongly opposed by environmentalists. Matt Smith, an analyst at Kentucky-based trader Samet Energy, pointed out that the reversal of the trend on Wednesday was "almost a knee-jerk reflex against the pipeline project. However, after this effect is dissipated, the cool minds will realize that A similar pipeline plan will be submitted again, and the Pan-Canada company will also be allowed to redesign the route and submit the application again."

Matt Smith also pointed out that the cornerstone pipeline was mainly designed for the export of oil sands and oils from Canada. “This is considered to have an extremely damaging effect on the environment. The original design route will pass through Sandhills, Nebraska. Once a pipe leak occurs, it may seriously pollute the surrounding water supply."

Earlier on Wednesday, the International Energy Agency released a report that will make a large-scale downward adjustment of global crude oil demand in 2012. The report said that "even if it is not a new recession, the global economic growth slowdown in 2012 is very likely." The report will reduce the world's crude oil demand in the first quarter is expected to reduce 500,000 barrels per day, while the annual demand growth is expected to be daily Lowered 200,000 barrels.

However, analysts at Commerzbank AG pointed out in the client’s report prior to the publication of this report that even if there are downward adjustments in the report, it will not have much impact on prices. “The U.S. Energy Information Administration and the Organization of Petroleum Exporting Countries have fine-tuned their respective The demand forecast is that the adjustment of the IEA will not be a big accident. It may not cause a negative impact on oil prices at all. In particular, investors are now paying more attention to supply-side risks."

The tense confrontation between the Western countries and Iran on the latter’s nuclear development projects has always been the biggest risk factor for crude oil supply: the EU will also soon decide whether or not to implement the crude oil embargo on Iran in July; Iran is The closing of the Hormuz strait with ** obstructs about one-third of the world's crude oil transportation in response.

The main economic data, the US Department of Labor data show that in December 2011 the wholesale price index fell by 0.1%, in line with market expectations; the same month the industrial production value is a 0.4% increase, of which the factory output has a substantial increase of 0.9% , is the largest monthly increase in a year.

In other energy products, the February natural gas contract fell 2 cents on Wednesday to close at 2.47 US dollars per million British thermal units, a decrease of 0.6%. This is also the lowest closing price of natural gas contracts since March 2002. The natural gas contract price has fallen for seven consecutive trading days and has fallen by 17% this year.

Barclays Capital analysts pointed out in a report on Wednesday that natural gas prices do not have a short-term floor. According to the report, “When natural gas prices fell below US$3 per million U.S. heat units in 2009, although many companies announced that they had tightened their supply, there was no obvious decline in supply. In 2012, supply prices were also in the range of US$2. There is not much response, and even more, the response comes from the demand side, such as replacing coal with natural gas."

February's formula gasoline contract rose 5 cents Tuesday to close at 2.82 US dollars per gallon, or 2%; February distillate fuel oil fell 2 cents to 3.01 dollars per gallon, a decrease of 0.8%.