SunSirs: During the Cycle, Crude Oil Prices Fell, and Retail Prices of China Refined Oil Products Experienced a "Double Consecutive Decline"

https://www.chemnet.com   Aug 09,2024 SunSirs

The domestic refined oil price adjustment window opened at 24:00 on August 8th. The zero selling price of refined oil has once again been lowered, and the retail price in 2024 has experienced seven upward adjustments, five downward adjustments, and three stranded adjustments. During the cycle, the negative value of crude oil change rate has increased, and the retail price adjustment of refined oil in 2024 will encounter the "sixth" downward adjustment.

Entering this pricing cycle, the international oil price market has experienced a significant decline. As of the 7th, the settlement price of the main contract for WTI crude oil futures in the United States was $75.23 per barrel, and the settlement price of the main contract for Brent crude oil futures was $78.33 per barrel. During this cycle, the crude oil market has declined. On the one hand, the OPEC+production reduction of 2.2 million barrels per day will be implemented until the end of September, but from October onwards, depending on market conditions, production may gradually increase, which is bearish for the crude oil market. On the other hand, the poor non farm payroll data and rising unemployment rate released by the United States in July, coupled with poor global economic data, have intensified market concerns about the demand outlook and increased negative pressure on the psychological level, leading to a decline in the crude oil market trend. Overall, the crude oil market has significantly declined during the cycle, with a negative change rate. As of the 8th, the change rate of crude oil varieties on the 10th working day was -5.81%, corresponding to a decrease of 305 RMB/ton for gasoline and 290 RMB/ton for diesel. The discounted price has decreased by 92# 0.0.23 RMB, 95# 0.25 RMB, and 0# 0.25 RMB.

In terms of gasoline: Recently, the operating rates of both main and local refineries have increased to a certain extent. The average operating rate of Shandong refineries has risen to around 55%. Local refineries in China have not yet overcome severe losses, and the processing profits of main refineries are meager. The supply of finished oil has increased, and there has been little change in gasoline demand recently. Intermediaries need to replenish inventory as needed. Thanks to the stable consumption level in summer, the gasoline market is mainly volatile.

In terms of diesel: Recently, the contradiction between diesel supply and demand has emerged, and the diesel market on the supply side has increased. However, the demand for diesel is sluggish, and it is currently in a rainy season with frequent hot and rainy weather in various regions. The operating rate of outdoor construction units and logistics transportation oil companies remains low. In addition, due to the impact of the fishing holiday in some sea areas, the consumption of resources in the diesel market is slow, and traders and terminal enterprises are cautious in their procurement operations. The diesel market has accumulated a small amount of inventory, which has led to a slight decline in the diesel market recently.

Looking at the future: Currently, geopolitical instability continues to affect the market. The traditional peak season in the United States is coming to an end, and coupled with poor economic data performance, fundamental concerns may cause short-term fluctuations in crude oil. From a domestic perspective, the short-term refinery operating rate has slightly increased, the number of summer travelers has increased, the use of air conditioning in summer has increased, the demand for gasoline is still guaranteed, and the price trend of the gasoline market is fluctuating; In terms of diesel demand, the end of fishing bans in some sea areas has boosted diesel prices. In addition, with the gradual reduction of high temperatures in the later period and the gradual increase in outdoor operations, diesel prices have shown a rebound trend in the later period.

If you have any questions, please feel free to contact SunSirs with support@sunsirs.com.

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