When international crude oil plummeted, two barrels of oil were under great pressure. What caused the performance loss?

Two barrels of oil were disclosed in the first quarter of 2020. According to the performance report of two barrels of oil, Sinopec and PetroChina suffered losses of 19.78 billion and 16.23 billion yuan respectively in the first quarter.

Everyone broke into a cold sweat when they saw the performance of Two Barrels of Oil. When international crude oil soared to US$100, Two Barrels of Oil was still losing money every year, which put great pressure on them. But now the international crude oil price has plummeted to 10 US dollars, and the two barrels of oil are still losing money. They are also shouting about losses, and the pressure is great. Once again, the operation has entered a critical juncture.

The performance of two barrels of domestic oil really puzzles the people. Domestic oil companies are monopolistic. Since it is a monopoly industry, it is also a huge profit industry. Why is international crude oil soaring and plummeting, with both barrels of oil claiming losses and great pressure?

As for these questions, let me analyze and answer them for you. The main reason is that when international crude oil plummeted due to the following three major reasons, the two barrels of oil were under great pressure and suffered losses:

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(1) my country is a major oil importer and a major oil exporter. When international crude oil plummets, the oil imported by my country will definitely be cheap, but transportation costs will increase.

In addition, the cost of extracting oil in our country is relatively high, basically reaching between US$40 and US$50. However, international crude oil has plummeted, and domestic oil can only be exported at a loss.

So when the international crude oil price plummeted, one was positive and the other was negative, but the profit from imports was not worth the amount of export losses, which directly caused the performance loss of two barrels of oil.

(2) International oil prices have real-time prices on every trading day, while domestic oil imports of two barrels of oil are in large quantities. Every time large quantities of oil are imported, there will definitely be inventory. Inventory Loss occurs.

For example, two barrels of oil were bought at a cost of US$65/barrel, and then international crude oil plummeted to US$20 in the short term. my country's floor price of US$40 takes effect, and two barrels of oil are sold to citizens at US$40/barrel. In this way, two barrels of oil are equivalent to a loss of US$25 per barrel, which directly results in a loss of two barrels of oil inventory, leading to a loss in performance.

(3) The turnover of Two Barrels of Oil was lower than expected and dropped significantly. Due to the reduced turnover, the turnover was not enough to cover the operating costs of the gas station, resulting in Two Barrels of Oil's losses.

For example, due to the impact of the global epidemic in 2020, the global demand for oil has decreased. The country has also been affected by the epidemic. Everyone is staying at home and not driving out, which directly reduces the demand for oil and reduces the price of two barrels of oil. The turnover is reduced, and the turnover is not enough for operating costs, resulting in oil companies' performance losses.

The international oil price has fallen, and oil companies are under great pressure. I would like to share my personal opinion on this matter.

The above has analyzed the three major reasons why oil companies suffered losses after the international crude oil price plummeted. These three reasons are also very relevant and true.

From these three major reasons, we know that when international crude oil falls, domestic oil companies will indeed suffer losses under special circumstances, such as oil companies selling oil at a loss, inventory losses, and turnover being too low, etc. losses caused.

This is my personal opinion about Two Barrels of Oil. As citizens, we should analyze and view a problem from two perspectives. We cannot analyze and view the problem from one side. We must put ourselves in the situation. Only by truly experiencing it can you understand the difficulties.

But then again, there is no doubt that the domestic oil industry is a circuit breaker and a profiteering industry. And Two Barrels of Oil claims to be losing money every year, but it actually makes money every year. Therefore, when people hear Two Barrels of Oil shouting to lose money, their ears get calloused, and they feel that it is not credible.

In real life, two barrels of oil are indeed profitable every year. Two barrels of oil only really lose money during special periods, such as the impact of the current epidemic, coupled with the continued plummeting of international crude oil. This time, two barrels of oil are claiming losses. It is believable. The rest of the time when two barrels of oil are called a loss, it is not believable. People will think that the more they call a loss, the more money they make. They are already disgusted by the two barrels of oil calling a loss.