1. Brent is approaching the $80 mark, and market concerns are rising.
As of April 20, the WTI price was US$77.29/barrel, down 7% from April 12; the Brent price was US$81.1/barrel, down 7% from April 12. Crude oil prices have continued to fall this week, and concerns about the demand side have gradually increased. Oil prices have stepped out of the downward curve, and the market fluctuation range has exceeded expectations. The benefits brought by production cuts have faded, and there are doubts whether crude oil can have other corrective performances under the pressure of declining economic growth at the macro level. This will be fed back to the cost of base oil, and it is expected that there will be insufficient support from the benefits.
2. Base oil continues to maintain low inventory mode, and the positive attitude will be weak in the later period.
Inventories continue to remain low during this period. Refineries are worried about the increase in market supply after the restart of Xintai Petrochemical, Huanghe New Materials, Nanjing Refinery, and Qingyuan Petrochemical in the later period, and the market demand side has no driving force to drive the market upward; refineries are supplying Increase the early stage, keep your own inventory low, arrange orders in advance, and alleviate the pressure in the later stage. However, the current situation of low inventory seems to have been overdrawn in advance this week, and the market performance is still showing a downward trend.
3. Market transactions are light and prices continue to fall
The production-to-sales ratio of domestic Class II paraffin-based base oil was 104%, down 10% from the previous cycle. Last week’s good production and sales were short-lived, but this week there has been a decline. The May Day holiday is approaching, and the purchasing sentiment before the holiday is low, which drives the market to improve. Market prices fell, transaction performance was tepid, and transmission resistance began to gradually appear.
As of today, the spot transaction price of 10# is 8,068 yuan/ton, -0.6% month-on-month, and the spot transaction price of 32# is 9,135 yuan/ton, -0.9% month-on-month. (This price is a self-raised price) The refinery will have a slow increase but the demand side performance is mediocre, and the rigid purchasing mentality is becoming more and more obvious; the mentality level is temporarily weak, but the news and cost support have not been released well yet, and the market is expected to Move forward with caution and pay attention to the stocking situation before May Day.
To sum up: Under the overall influence of the weak global macro economy, coupled with the advent of the traditional off-season, market orders are poor and trading is cautious. It is expected that terminal procurement will maintain rigid demand. After the May Day holiday and some refineries restart, the market is expected to As supply increases, base oil market expectations are relatively pessimistic. Negative terminal feedback is dragging down the current market trend of base oil products. It is expected that base oil market prices will fluctuate downward.
</p
