Key Topics

Watchlist Data Center Market Center Capital Flow Simulated Trading

Client

Chen Junhao Guotai Junan Futures Market Analyst Z0021546

International oil prices have risen for the second consecutive day, with domestic crude oil experiencing a rapid increase before the afternoon market close today. As of the midday close, the main SC crude oil contract surged over 3%, driving a rebound in related crude oil products, including fuel oil, asphalt, and PX, which all saw increases of over 2%. Additionally, PTA, staple fibers, and bottle-grade PET experienced gains exceeding 1%. What are the primary drivers of crude oil prices in the short term, and how do we view the market outlook? Let's discuss.

Firstly, on the macro level, U.S. officials have indicated that the government shutdown crisis “likely will be resolved within this week,” leading to a resurgence in risk appetite as market funds shift from safe-haven assets to risk assets such as crude oil, thus providing temporary support for oil prices.

From the supply and demand perspective, geopolitical factors still pose significant uncertainty, with developments in U.S.-Russia meetings potentially affecting the situation and the second phase of ceasefire negotiations in Gaza remaining unresolved, which keeps oil supply risks in play. On the demand side, the U.S. Department of Energy has stated it is looking to purchase 1 million barrels of crude oil for the Strategic Petroleum Reserve. Additionally, data released by the American Petroleum Institute (API) showed a decrease in U.S. crude oil, gasoline, and distillate inventories last week, with a decline of 2.98 million barrels in crude oil stocks as of the week ending October 17. This evening, the EIA inventory data should also be monitored.

Although oil prices are rebounding in the short term due to multiple factors, we should remain cautious about the longer-term surplus in supply and demand exerting downward pressure on prices. U.S. crude oil production has reached historical highs, and OPEC+ continues to push for increased output, while global trade uncertainties have amplified market expectations for suppressed oil demand. Technically, the recent rebound in SC crude oil prices after a rapid retracement should be approached with caution, paying attention to resistance near the gap above. (Final draft time: October 22, 2025, 14:00)

This content is for educational purposes only and does not constitute investment advice. Receiving this article does not establish any business relationship between readers and Guotai Junan Futures. Our company does not guarantee the accuracy, completeness, or reliability of the information provided, and investors assume their own risks. The views expressed herein are solely those of the author and do not represent the company's stance. Any form of reproduction, modification, or citation without written authorization is prohibited. For reprints, please credit Guotai Junan Futures and ensure the completeness of the content, without distorting, editing, or altering the intent of this commentary.

Guotai Junan Futures Account Opening via Sina's Cooperative Platform is Safe, Fast, and Secure.

Massive information, precise interpretation, all available on the Sina Finance APP.

Editor: Li Tiemin