In the market in September, the “hot and cold rhythm” has become a bit faster. When I woke up, it was reversed again…
International oil prices rose significantly on the 15th. As of the close of the day, the price of light crude oil futures for October delivery on the New York Mercantile Exchange rose by $2.15 to close at $72.61 per barrel, an increase of 3.05%; the price of London Brent crude oil futures for November delivery rose by $1.86, It closed at US$75.46 per barrel, an increase of 2.53%.
U.S. crude oil futures hit their highest closing price since the end of July on Wednesday. Oil prices found support after the U.S. Energy Information Administration reported that U.S. crude oil supply fell by 6.4 million barrels last week.
Oanda senior market analyst Edward Moya said: “Oil’s rally is far from over as demand and supply drivers remain mostly bullish: further delays to the Iran nuclear deal, The possibility of colder weather during the winter and a very active hurricane season could cause further production disruptions.”
Goldman Sachs: “Inventory shortages” for various commodities
Oil prices will be the next tipping point
“Commodity flag bearer” Goldman Sachs It is believed that under the current background of low inventories, supply shortages may push commodity prices to rise further. As the northern hemisphere enters autumn, rising crude oil prices may prompt investors to return to the commodity reflation trade.
Goldman Sachs said that global commodity demand has gradually recovered, catalyzed by the expanding scope of vaccination. With the exception of crude oil, demand for almost all commodities has returned to pre-epidemic levels. As commodity inventories built up during the pandemic continue to decline, markets are now increasingly vulnerable to short-term supply disruptions (such as Russian gas export disruptions) or unexpected increases in demand (such as hot weather). The market demand for individual products has even reached unprecedented heights, such as natural gas; however, due to the imbalance between supply and demand, its prices have also risen ridiculously – American gas has hit a new high in the past 10 years, and European gas has increased 10 times in 14 months. The market has predicted that global natural gas prices will continue to rise further in the second half of the year.
In addition to natural gas, oil is also in a supply-demand imbalance. Major institutions have predicted that oil prices will rise sharply in the second half of the year.
Let’s take a look at Goldman Sachs’ analysis first. Goldman Sachs believes that although demand for crude oil has not yet returned to pre-epidemic levels, crude oil prices are likely to rise sharply against the backdrop of low inventories and the upcoming heating season. According to data released by the U.S. Energy Information Administration, the current overall U.S. crude oil inventory level is close to the average level from 2015 to 2019, and is continuing to fall. Goldman Sachs warned that rising crude oil prices could be a catalyst for investors to return to the commodities reflation trade as the northern hemisphere heads into autumn.
The impact of the Delta virus on global crude oil demand is limited, with oil demand barely declining during the outbreak; however, affected by Hurricane Ida, the recovery of U.S. crude oil production continues to be lower than market expectations . Given the collapse of the Iran deal. If oil prices return to $80/barrel levels, global investors will return to the commodities reflation trade.
Also, while demand for oil barely declined during the rapid spread of Delta, crude oil production in the heartland of the U.S. energy industry was hit hard by Hurricane Ida. , has not yet recovered. According to statistics from relevant departments, starting from August 29, the southern United States lost 16.9 million barrels of crude oil in 10 days, the heaviest loss in history.
To put it simply, when there is already a gap in global crude oil supply, the impact on U.S. crude oil production is likely to expand the market supply gap, even with OPEC + 400,000 barrels The increase in production per day will not help either. According to the bullish principle of the commodity market: as long as supply exceeds demand, prices will rise.
Let’s look at Citigroup’s analysis. According to Citigroup’s forecast, after Hurricane Ida and the strong winds of Nicholas are about to hit, the U.S. production reduction may reach 30 million barrels in September, and will reach 5 million barrels in October. In addition, the demand recovery in East Asia is beginning. The strong trend of crude oil is expected to remain until the fourth quarter of this year. It is reported that WTI crude oil has hit a 6-week high and is back above $70.
The last is the analysis of Bank of America. Compared with supply, Bank of America is more concerned about the increase in demand caused by the weather. According to the agency’s report, if the winter in the northern hemisphere is colder than before, strong demand will push oil prices to US$100 per barrel. You know, the northern hemisphere has experienced rare high temperatures and droughts this year, and it is not surprising to see rare low temperatures.
The strong rebound in oil prices may give rise to declining oil prices
The polyester market has received a shot in the arm!
For those in the polyester industry, taking this opportunity, is it possible that oil prices will soar to a high of 80 US dollars, and polyester, which is also a bulk raw material, will take the opportunity to get rid of oversupply and low prices. The lingering situation has become the focus of many people’s attention!
Driven by the surge in crude oil, the main PTA futures contract of Zhengzhou Commercial Exchange has gradually climbed from a low of 4,736 points last Friday to now exceeding 5,000 points. Similarly, ethylene glycol has been rising, with an increase of more than 6% in the past week; in addition,Recently, the price of polyester filament has been rising steadily. Although there are still promotional measures, the intensity of promotion has dropped significantly. Manufacturers with preferential measures even threatened to cancel the discount at any time due to the rising cost of raw materials.
From the perspective of polyester raw materials, the recent stabilization and rebound of crude oil, coupled with the frequent good news on the PTA side, coupled with the increase in upstream maintenance from September to October and the supply and demand structure, the To improve, PTA is expected to rebound.
With the restart of the Zhongtai and Sanfangxiang units last week, the PTA load returned from low to neutral levels. However, from September to November, the PTA production end will once again undergo centralized maintenance. The total maintenance production capacity of enterprises including Hengli, Yisheng, Tongkun, Honggang and Fujian Baihong exceeds 10 million tons. In late September, the 280,000-ton line of Liaoyang Petrochemical will be inspected for 10 days. A 2.25-million-ton line of Hengli Petrochemical will be inspected at the end of September. Fujia Dahua will inspect the 1.4-million-ton line for 45 days in early October. As Hengli Line 5 will be overhauled on October 8, Line 3 will be overhauled in late October, and Honggang Petrochemical’s 1.5 million tons will be overhauled in October, the supply side is expected to shrink even more strongly. As an industry with relatively high concentration, Industry, this move will have a significant supporting effect on PTA prices.
In addition, in terms of ethylene glycol, tight supply is good for prices, and there is still support below. News shows that a 400,000-ton/year syngas-to-ethylene glycol device is planned in Inner Mongolia 9 It restarted on the 14th of March. The device was shut down for maintenance in early August. The restart of a 200,000 tons/year synthesis gas to ethylene glycol device in Shandong was postponed. The specific plan has not yet been determined. The device was temporarily shut down in late August. And according to relevant market rumors, power restrictions in Jiangsu may have a certain impact on the load of local ethylene glycol devices.
In other aspects, according to relevant public information, import volume may decline significantly from September to October. This is due to the fact that many overseas units in Saudi Arabia, Iran, and the United States were shut down for some reason in early August, and considering the shipping schedule, this part of the production loss will be reflected in the import volume in September, so imports are expected to be reduced. Looking at the fourth quarter, considering that starting from October, many sets of equipment in Saudi Arabia and the United States will start maintenance again, there may still be a decline expected. Therefore, overall, ethylene glycol related supply may still be in a tight situation.
Let’s take a look at polyester yarn. Recently, boosted by crude oil and polyester raw materials, with the cost of polyester melt reaching 6,150 yuan/ton, the price of polyester filament has increased significantly. Some are facing losses, and the pressure on the cost side is a big challenge for polyester factories. However, judging from the current polyester market conditions, most manufacturers are still waiting to see shipments, partially canceling discounts or slightly increasing prices in the short term to test downstream reactions.
The shortcoming of the sluggish polyester market is demand. Downstream orders are limited. The fabric market transaction volume has not changed much from the previous period. The market transaction varieties are relatively messy, and orders from downstream buyers are scattered. It’s chaotic, and manufacturers are slow to remove inventory. At the same time, weaving enterprises are trapped by capital and inventory pressures, and the procurement of raw materials is not as intensive as in previous years.
But the good news is that the weaving operating rate has gradually bottomed out recently, and even if the recovery is still slow, it is a good sign. The current external demand is mainly restricted by sea freight and timeliness factors, and the short-term increase is not obvious. With the gradual control of the domestic epidemic, market demand is still expected to improve in the later four quarters. Therefore, if terminal orders can improve by then, it may further drive the weaving operating rate. rebounded, subsequently boosting demand for raw materials. </p
