The current domestic refined oil price adjustment window opened at 24:00 on December 5th, and the zero selling price of refined oil has once again been lowered. The retail price adjustment in 2023 has gone through "ten increases, ten decreases, and three stalls". The crude oil market has risen first and then fallen during the cycle, with a change rate from positive to negative, and the adjustment range has just reached 50 RMB/ton. This round of refined oil retail price adjustment may encounter "five consecutive declines".
Entering this pricing cycle, the international oil price trend first rose and then fell. As of the 4th, the settlement price of the main contract for WTI crude oil futures in the United States was $73.04 per barrel, and the settlement price of the main contract for Brent crude oil futures was $78.03 per barrel. Firstly, OPEC+member countries have stated that they expect the additional production reduction in the first quarter of 2024 to be voluntary in nature. The market is concerned that the constraints of voluntary production reduction by member countries may be limited, and the actual implementation may be difficult to reach the planned scale. Previously, the crude oil market rose due to the news of production reduction, and the price trend of crude oil declined after the consumption surface digested in the later period. Secondly, data released by the US Energy Information Agency (EIA) this week showed that US crude oil production rose to a monthly record high of 13.2 million barrels per day in September, while natural gas production remained near record highs; The increase in US crude oil inventories is bearish for the crude oil market. Finally, the economic downturn in Europe and America resulted in a sluggish manufacturing industry in the United States in November, leading to a decrease in factory employment. Due to weak demand, global manufacturing demand has not improved. The combined influence of bullish and bearish factors has led to international oil prices rising first and then falling in this cycle. As of the 5th, the change rate of crude oil varieties on the 10th working day was -0.48%. It is expected that gasoline will be reduced by 55 RMB per ton, diesel will be reduced by 50 RMB, and the discounted price will be reduced by 89# 0.04 RMB, 92# 0.04 RMB, 95# 0.05 RMB, and 0# 0.04 RMB. The zero selling price of finished oil will be further lowered in this round.
In terms of gasoline: Recently, due to the shortage of raw materials, the production of Shandong refineries has declined. The production of Shandong refineries has been around 64%, and the main domestic refineries have slightly declined. It is expected that the production of gasoline and diesel will both decline in November, which will to some extent support the domestic refined oil market prices. However, in the short term, there will be no holiday support, travel demand will return to normal, and air conditioning oil support will be lost. The demand for gasoline has decreased, and some businesses will moderately restock on dips. Purchasing sentiment is not positive, and gasoline prices will fluctuate at low levels.
In terms of diesel, the supply of diesel has slightly declined, coupled with fluctuations in the crude oil range. With the impact of low temperature, rain, and snow weather, diesel demand in the infrastructure industry has gradually weakened, and outdoor infrastructure and engineering construction have declined. However, there has been an increase in livestock and poultry exports, and there is still support for fishing production demand. The long short game has led to a sluggish diesel market.
Looking at the future: the logic of crude oil trading in the short term is still a supply-demand game, and the weakening of the US dollar may have a supportive effect on oil prices in the near future. However, the poor demand in Europe and America will correspondingly suppress the crude oil market, and oil prices may continue to fluctuate widely. In terms of domestic supply, Shandong refineries have maintained a weak pattern of production, with little change in supply. Downstream demand is mainly in demand, and the short-term trend of gasoline and diesel prices is mainly volatile.
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