The global epidemic is still severe, and oil demand will drop sharply. As the previous production reduction agreement expires at the end of March, oil-producing countries such as Saudi Arabia and Russia will start to increase production, and the price war has not eased. In the short term, international oil prices are still under pressure.

Second, since March to control the epidemic, many countries have adopted foot-free measures to encourage people to work at home and reduce travel. A large number of airlines have cut flights or even grounded all flights due to declining passenger flow. The demand for aviation fuel and automobile fuel has plummeted.

Experts predict that global oil demand will continue to decline in the future, low oil prices will be difficult to reverse in the short term, and the oil industry will face severe challenges.

Saudi Arabia, the world's number one oil exporter, announced that it would increase production and cut prices. The imbalance between market supply and demand has intensified, and international oil prices have plummeted in panic. Compared with the price of US$40 to US$50 per barrel at the beginning of the month, the current cumulative decline in international oil prices has exceeded 50%.

According to the analysis of Rystad Energy Company, if the major oil-producing countries start to increase production in April, the world will fall into a situation where the daily oil supply exceeds the demand by 10 million barrels, and 76% of the global oil storage facilities are already saturated. The next few months It is difficult to receive more petroleum products within the country.

According to a report by Lustad Energy, more than 5 million people are currently employed in the oilfield service industry. This year alone, the labor force in this industry will shrink by 21%, 13% of which is due to the drop in oil prices. 8 % Is related to the company's concern that the epidemic will spread on the construction site and slow down the project development.

Analysts believe that this round of decline in oil prices may change the layout and power balance of oil companies. Some large oil companies have announced reductions in operating costs, and oil giants Shell and Total have made it clear that capital expenditures will be reduced by 20% this year. Some oil companies may face bankruptcy, but there will also be some companies that find new investment opportunities in the crisis.