International oil prices are uncertain

The international oil price was in a state of "deterrence," causing other related chemicals to lose their direction. In particular, the rebound of the previous "star" methanol came to an end. Analysts said that the downstream demand for chemical products gradually recovered, and its prices were supported. However, due to the dramatic fluctuations in the crude oil market, the uncertainty of chemical products such as methanol, PVC, and plastics rose sharply, and the market had significant differences.

"Head" violent fluctuations

Although the price of crude oil only appeared at an amplitude of US$10, it was enough to make the downstream chemical market lose its direction. Since February, international oil prices have fluctuate drastically, rising from around $44 per barrel to $50. The 11% increase or 8% decline has been quite common in the recent trading market. The price trend of crude oil in the United States seems to have changed. Has become "willful."

Investors are unpredictable about the nature of the crude oil market. From several trading days from January 29th to February 9th, the market once thought that the international oil price would rise to more than 60 US dollars per barrel, but then the international oil price stopped rising, and gradually adjusted to 50 US dollars / barrel. As of the time of this reporter’s press release, the price of New York NYMEX crude oil that was settled in April this year was quoted at below 50 US dollars per barrel.

Goldman Sachs recently released a report, the United States this year crude oil production increased by 385,000 barrels per day to 290,000 barrels per day, saying it was affected by the decline in the number of rigs. However, CITIC believes that the slowdown in output growth is a definite event, but the main point of market disagreement lies in time, and the probability is higher in the second quarter. Therefore, in the short term, WTI is also subject to the current inventory pressure and supply slowdown expectations. In a dilemma, it is expected that shocks will continue to dominate the short-term.

It is worth noting that on March 3rd, Saudi Arabia reversed its pricing strategy for Asian buyers and substantially increased the price of oil exported to Asian markets. In a list of official crude oil prices delivered to crude oil buyers, Saudi Arabian National Oil Company raised the price of light crude oil exported to Asia in April by 1.4 US dollars per barrel, reversing the price reduction strategy of the previous months.

Chemicals short-term material shocks

Some analysts said that Saudi’s increase in the official export prices of Asian oil indicates that Saudi Arabia’s belief in crude oil demand is more robust. This situation naturally benefits the crude oil market. However, investors need to be wary that the crude oil market may not fully digest EIA crude oil. The fact that the stock has soared by 10.3 million barrels means that the rebound in crude oil prices has provided a rare short-selling opportunity for rallies.

As a chemical product downstream of crude oil, its price trend will lose direction in the short term. Take PTA as an example, industry insiders believe that the recent fluctuations in crude oil intensified and the downstream stocks are currently low, making the market vulnerable to speculation.

CITIC ** released a report saying that downstream demand has recovered after the Lantern Festival, but the PTA operating rate has also increased slightly, so the situation of high PTA stocks will not change much; and crude oil prices have shown signs of weakness, especially The WTI crude oil with large inventory pressure is expected to have a high probability of a short-term drop in crude oil prices. This will drive down PX prices to suppress the formation of PTA, thus maintaining the view of a weaker pattern.

This is also true of methanol. At present, methanol companies have little pressure on their inventory, and port inventories have continued to decline. Considering the recovery of traditional downstream demand and the maintenance of methanol plants, these factors are still supporting the methanol market. However, there are also views that the current high methanol prices, energy and other varieties of the plate has declined, the price of methanol will also have an impact, so before the real demand in downstream demand, methanol prices may still callback.