Within the day, a significant surge was observed across various crude oil-related commodities! Data indicates that the main crude oil contract rose by more than 4% during trading, with prices peaking at 577.9 yuan/barrel, while fuel oil also saw an increase exceeding 4%, and low-sulfur fuel oil rose by more than 3%.

Market analysis suggests that the gasoline supply disruption caused by Hurricane Milton in the United States, along with the risks associated with geopolitical tensions in the Middle East, could be the primary factors behind the substantial increase in crude oil-related prices during this round.

The gasoline supply disruption triggered by Hurricane Milton in the United States might have been the main catalyst for the rise in oil prices last night.

As the world's largest producer and consumer of oil, the United States was hit by Hurricane Milton, which swept through Florida, leading to gasoline shortages at about a quarter of the state's gas stations and causing power outages for over 3.4 million homes and businesses.

Analysts at the energy consulting firm Ritterbusch and Associates stated in a report that widespread power outages could impact the supply of refined oil products next week due to the closure of terminal facilities, delays in tanker deliveries, and disruptions in pipeline transportation. The report from Ritterbusch posits that the high uncertainty surrounding Florida's oil infrastructure is generally supportive of gasoline prices.

Advertisement

In addition to the risks of supply disruptions, escalating concerns over geopolitical tensions in the Middle East also have a positive effect on oil prices.

During the National Day holiday, Iran's attack on Israel led to a sharp increase in geopolitical risks. The market is most concerned about whether Israel will target Iran's oil facilities. Should Israel strike Iran's oil facilities, there is still significant room for crude oil prices to rise.

Looking ahead, if Iran's oil infrastructure becomes a target for Israeli attacks, global supply could decrease by as much as 4%. Iran's oil production is already operating near full capacity, and with escalating tensions, the production could become even more vulnerable. Moreover, if the scope of the attacks expands to the Strait of Hormuz, which accounts for one-fifth of global demand, it would have an even greater impact. Saudi Arabia, Iraq, the United Arab Emirates, Kuwait, and Qatar all send their cargo through this critical waterway.

Outlook for the crude oil market:

[The rest of the text seems to be cut off, so I cannot provide a translation for the "Outlook for the crude oil market" section. If you can provide the full text, I would be happy to translate it for you.]For the outlook of crude oil prices, Everbright Futures analysis points out that due to the impact of Hurricane "Milton", some gas stations in parts of Florida are unable to receive supplies. GasBuddy data shows that about 24.8% of gas stations in Florida are out of fuel, leading to a surge in fuel consumption in the United States, and there is still uncertainty in the geopolitical situation in the Middle East. From the balance sheet perspective, the EIA estimates that there will still be a significant supply-demand gap from the fourth quarter of this year to the first quarter of next year. Previously, under the background of improved macro sentiment, both domestic and international oil prices have stabilized and rebounded. However, the lack of confidence in future demand expectations is still the main factor. Although the current fundamentals have not deteriorated significantly, it is expected that short-term oil price fluctuations will still be large. After entering the fourth quarter, the off-season for demand, if there is no unexpected supply and demand data support, oil prices may weaken again.

At the same time, Zhengxin Futures also mentioned in its latest view that the geopolitical risks in the Middle East have increased, and the market has a clear concern about the possible interruption of crude oil supply. The bullish impact brought by geopolitics obviously exceeds the bearish factors of the fundamentals in the medium and long term. However, the future direction of oil prices will depend on Israel's response. At present, the volatility of the crude oil market is still high, and the market needs to be treated cautiously. If the geopolitical situation does not deteriorate, the supply and demand fundamentals will once again become the main driver, and the geopolitical premium may quickly give back.