Crude oil prices fell in April. The reason is that the global economic outlook announced by the IMF in April shows that the global growth rate in 2022 will decline due to the slowdown in recovery from the new coronavirus disease due to soaring prices of crude oil and other supply constraints associated with Russia’s invasion of Ukraine. Corrections, slowing economic recovery hinders growth in crude oil demand Rekindled caution, US long-term interest rates are rising due to expectations of US monetary easing against the backdrop of inflation concerns, and the appreciation of the dollar has made crude oil futures more expensive. WTI prices have fallen due to awareness, widespread corona infections in China, prolonged lockdowns in Shanghai, and widespread speculation that lockdown measures will be taken in Beijing as well.
On the other hand, the EU sought to break away from Russia’s energy dependence, and the possibility of a gradual embargo on Russian crude oil increased, causing a tight supply-demand balance for other markets. In addition, it is becoming clear that production of Russian crude oil will be reduced (a 17% decrease in 2022), and the supply of natural gas to Poland and Bulgaria will be stopped. In response to this, Henry Hub (natural gas) Market conditions have skyrocketed, and NY heating oil futures have reached market highs. The futures market is a manifestation of extreme backwardation and tight supply and demand, and is expected to remain volatile unless the Ukrainian crisis is settled.
CP prices have fallen as well as WTI. Two months after Russia’s invasion of Ukraine, the crude oil market has been volatile, and in Europe, the warm climate, petrification, demand for gasoline blends have declined, and demand for natural gas alternatives has helped, but both propane and butane have fallen due to the softening of the crude oil market. The Middle East market also entered a period of non-demand, and demand for PDH was scattered in China, Vietnam, etc., but there were many spot sales in gas-producing countries such as Qatar and Saudi Arabia, and the sense of tight supply and demand diminished. Demand for butane as a substitute for naphtha has disappeared from the west coast of Australia and the west coast of the United States, as there are spots for butane-equipped cargo. In the United States, demand for propane has passed its peak, but remains strong and high with exports. (Reference: Energy Intelligence Network, ENEOS GLOBE)