Financial Services Association, September 19 (Editor: Feng Yi) The Federal Reserve's September interest rate cut was officially implemented, but the Hong Kong stock commodity concept did not rise as expected today, and petroleum stocks have clearly weakened.

As of press release, United Energy Group (00467.HK) fell more than 4%, China Energy Holdings (00228.HK) fell more than 1%, and Sinopec (00386.HK) and CNPC (00857.HK) both followed suit.

According to the news, even though the Federal Reserve chose to cut interest rates sharply by 50 basis points in the September interest rate decision. At the same time, however, the Federal Reserve also lowered growth expectations for a number of economic indicators, triggering a resurgence of recessionary transactions in overseas markets.

The statement showed that the Federal Reserve lowered expectations for GDP growth and core inflation during the year, and also raised expectations for the unemployment rate. The 2024 growth forecast fell from 2.1% to 2.0%, and the PCE and core PCE inflation expectations were lowered by 0.3 and 0.2 percentage points, respectively, to 2.3% and 2.6% during the year. The unemployment rate is expected to be 0.4 percent.

In fact, the market once linked interest rate cuts to the risk of recession, believing that the higher the risk of recession, the greater the rate cut. Combined with the current interest rate cut of 50 basis points and the Federal Reserve's reduction in economic expectations for the year, it seems to confirm the risk of a “recession.”

Notably, the US Department of Energy said it would seek to buy up to 6 million barrels of oil to supplement strategic oil reserves. However, the above favorable news did not clearly drive oil prices.

However, in its latest report, Citi predicts that the crude oil market may experience a counterseasonal deficit of about 0.4 million b/d in the fourth quarter, which may provide temporary support for oil prices at that time. Meanwhile, China's oil demand is likely to rebound 0.3 million b/d year on year in the fourth quarter, which will boost global demand and make up for this year's weak situation.

However, Citi also specifically pointed out that as the balance between global oil supply and demand deteriorates in 2025 under most scenarios, it is still expected that there will be a new price weakness in 2025, and the price of Brent crude oil will move towards 60 US dollars per barrel.

Taken together, although interest rate cuts are expected to boost commodities from the perspective of short-term liquidity and expectations, in the medium to long term, the market still pays more attention to actual demand for economic fundamentals.

Li Yunxu, an energy analyst at SDIC Anxin Futures, also pointed out in a recent report that total inventories of US crude oil and petroleum products have increased during the year. Moreover, the data shows that US oil products have not been effectively removed from storage since the third quarter.

Looking ahead to the future market, SDIC Anxin Futures believes that oil inventories are still expected to rise year-on-year in the fourth quarter after the peak seasonal demand season, and the supporting effect of low inventories on oil prices will gradually weaken.