In December, international crude oil prices trended downward amid volatility, exerting downward pressure on the market. For gasoline, prices remained firm throughout the month due to pre-holiday stockpiling demand ahead of the New Year's holiday and the early completion of annual sales targets by major players. According to Jinlianchuang's refined oil price index, as of December 30, domestic 92# gasoline stood at 7,776 yuan/ton, slightly up from the end of last month. For diesel, with advance quotas allocated and relatively ample feedstock supply, refinery operating rates rose in December, boosting diesel output. However, declining terminal demand led to a bearish outlook among market participants, who reduced procurement volumes, putting downward pressure on diesel prices this month. According to the Jinlianchuang成品油价格指数, the price of 0# diesel stood at 6,709 yuan per ton on December 30, down 3.25% from the end of last month.

Entering January, the refined oil market may be primarily influenced by the following factors:

Supply Aspect

In January, domestic refined oil supply is expected to see a slight increase from both major and local refineries, with projected growth in refined oil production. For major refiners, Yunnan Petrochemical plans to resume operations mid-month, while other facilities will maintain stable production with no new maintenance scheduled. This suggests a slight uptick in major refinery utilization rates next month. Local refiners face minimal maintenance in January, leading to a modest increase in their operating rates.

Demand Outlook

For downstream refined oil demand in January, gasoline consumption is expected to improve while diesel consumption shows a downward trend. Gasoline demand is anticipated to rise during the New Year holiday period as increased private vehicle travel accelerates consumption. Additionally, market participants may stockpile ahead of the approaching Spring Festival holiday, providing support to the gasoline market. However, market users may have pre-holiday stockpiling needs before the New Year holiday. For diesel, as the extended Spring Festival holiday approaches, outdoor mining, construction, and infrastructure sectors are scaling back operations, leading to further declines in diesel consumption.

Exports

January's gasoline export quota stands at 486,000 tons, an 82.02% month-on-month increase, while diesel exports are planned at 354,000 tons, a 10.61% month-on-month decrease. The significant rise in gasoline export quotas may help ease domestic supply-demand tensions, while the reduced diesel export quota has limited impact on fundamentals.

Cost Perspective

Entering January 2026, the global crude oil market faces a consumption slump during the off-season. Combined with subdued trading activity around the New Year holiday, crude demand will remain weak. Although OPEC+ suspended its planned production increases for Q1 2026, this move cannot fully offset market pessimism amid sluggish demand. Most institutions anticipate that the crude oil market's supply surplus will continue to widen. Global economic uncertainties will persist, though the market has developed some immunity, thereby reducing their impact on oil prices. Geopolitical tensions remain unpredictable—whether Russia-Ukraine ceasefire negotiations or Western sanctions against Russia and Venezuela—and any escalation could influence short-term oil price movements.

Overall, international crude oil prices in January are likely to fluctuate within a low range. Excluding force majeure factors, WTI is projected to trade primarily between $53 and $58 per barrel, Brent between $56 and $61 per barrel, and Oman between $57 and $62 per barrel.

Market Sentiment

Recent expectations of improved gasoline consumption have boosted restocking sentiment among industry players. However, diesel demand continues to decline, with bearish sentiment prevailing in the market and reduced trading activity.

Price Trends

Entering January, international crude futures prices may fluctuate at low levels, continuing to weigh on market sentiment. For gasoline, improved consumption during the New Year holiday and pre-Spring Festival stockpiling demand provide strong support. Gasoline prices are expected to see modest gains amid fluctuations in January. As the Spring Festival approaches, declining operational rates in mining, construction, and infrastructure sectors will drag down diesel demand. With ample overall supply, the supply-demand balance leans toward surplus, suggesting diesel prices will maintain a downward trend throughout January.

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