SunSirs: Domestic Fuel Oil 180CST Price Rises sharply (9.16-9.20)

1. Price Trend

As of September 20, the average domestic fuel oil distribution price was 4,650.00 RMB/ton, up 2.42% from 4,540.00 RMB/ton at the beginning of last week.

The fuel oil commodity index on September 20 was 94.18, unchanged from the day before, down 18.75% from the cyclical peak of 115.91 points (2018-10-17), and up 104.38% from the lowest point of 46.08 on August 15, 2016. (Note: Period refers to 2011-09-01 to date)

2. Analysis of Influencing Factors

Products: Domestic fuel oil trade last week was general, with the actual transaction price around 4,650 RMB/ton.

Industry Chain: According to the monitoring of SunSirs, U.S. WTI crude oil was $54.85 per barrel at the beginning of the week and $58.13 per barrel at the end of the week, with a weekly increase and decrease of 5.98%; Brent crude oil was $60.22 per barrel at the beginning of the week and $64.40 per barrel at the end of the week, with a weekly increase and decrease of 6.94%. Saudi Arabia's oil equipment was attacked the week before and the market rose in panic. Since the attack, the situation has stabilized. Saudi Arabia has not reduced its oil exports, and American inventories have increased. International oil prices have soared and fallen. On September 19 (Thursday), the weighted average price of Fushun Mining shale oil fell 45 RMB/ton, with 11,000 tons of winning bid, 11,900 tons of bidding and 11,000 tons of volume. The bidding base is 3,406 RMB/ton, the winning range is 3,446-3,486 RMB/ton, and the next bidding time is September 26.

Industry: According to the price monitoring of SunSirs, there were eleven kinds of commodities rising annually in the energy sector in the 37th week of 2019 (9.16-9.20). Among them, there were three kinds of commodities rising more than 5%, accounting for 18.8% of the monitored commodities in the sector. The first three commodities rising were liquefied gas (7.87%), Brent crude oil (6.94%) and WTI crude oil (5.98%).  There was only one kind of commodities falling in the ring ratio, and the product was diesel oil (-0.77%). This week's average rise and fall was 1.98%.

3. Market Forecast

SunSirs’ Energy analysts believe that the surge of international crude oil in Saudi Arabia in previous week led to the rise of domestic ship fuel market and shale oil prices, which led to a sharp increase of 100-200 RMB/ton in domestic ship fuel market. However, international crude oil prices dropped sharply at the weekend, and shale oil prices fell. The overall ship fuel market was depressed and the wait-and-see mood was strong. Fuel oil market prices are expected to remain stable in the near future, or around 4,650 RMB/ton.

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