SunSirs: The Retail Price of China Domestic Refined Oil Products has slightly Increased

The current round of domestic refined oil price adjustment window opened at 24:00 on June 28th, with a slight increase in the zero selling price of refined oil. The retail price adjustment in 2023 has gone through "four rises, six falls, and two stalls", and the crude oil market has fluctuated and risen during the cycle, with a positive rate of change. The retail price of refined oil in this round will rise for the fifth time this year.

Entering this pricing cycle, the international crude oil change rate remains positive. As of the 27th, the settlement price of the main contract for WTI crude oil futures in the United States was $67.70 per barrel, and the settlement price of the main contract for Brent crude oil futures was $72.51 per barrel. During this round of price adjustment, the international oil market has been intertwined between long and short positions. On the one hand, the announcement of interest rate hikes by the Federal Reserve and the European Central Bank has not yet ended, coupled with the slow global economic recovery, some developed economies may have started to fall into recession, suppressing expectations of energy demand growth, and putting pressure on the crude oil market. On the other hand, the unstable geopolitical situation has raised concerns about supply, diluting the bearish outlook for global demand. In addition, the growth of China's refining and processing volume has boosted international oil prices, supported by demand during the summer oil peak season, and boosted the international oil price market. Overall, during this price adjustment cycle, crude oil prices have slightly increased. As of the 28th, the change rate of crude oil varieties on the 10th working day was 1.21%. It is expected that gasoline and diesel will increase by 70 RMB/ton, equivalent to a price increase. 92# gasoline will increase by 0.05 RMB, 95# gasoline will increase by 0.06 RMB, and 0# diesel will increase by 0.06 RMB.

In terms of gasoline, the operating rates of Shandong local refineries and main refineries remain stable, with little change in supply. Shandong local refineries are operating at around 62%. Recently, with the appearance of high temperature weather, the use rate of private car air conditioners has increased. In addition, around the Dragon Boat Festival, there has been some support for gasoline consumption. The demand for gasoline has been guaranteed. The gasoline market is still supported, and the price has risen slightly.

In terms of diesel: There has been little change in the operation of main refineries and local refining enterprises, but in terms of demand, many parts of the country have experienced an increase in high-temperature weather, and outdoor industrial and mining, infrastructure, and other operations have been limited. In addition, the impact of the rainy season in the south has gradually ended the use of agricultural oil. The demand for diesel has weakened, and the trend of the diesel market has declined. In terms of social inventory of domestic refined oil products, the market is bearish. Companies are very cautious in purchasing in the market, and the market buying and selling atmosphere is light. Recently, the diesel market price has slightly declined.

The global oil market is mixed, with less clear guidance on the news. Under the expected impact of interest rate hikes in Europe and America, the outlook for energy demand is under pressure. However, geopolitical factors such as a decrease in Russian crude oil supply and stable demand in the Asian market support oil prices, and short-term oil market prices remain fluctuating. In terms of gasoline, the impact of high temperature weather in summer has led to an increase in the use of car air conditioners, and the gasoline market demand is expected to continue steadily. It is expected that the gasoline market will still have support; In terms of diesel, due to the impact of high temperatures and rainy weather, the outdoor operation rate may continue to decline, and demand support is insufficient. It is expected that the diesel market will slightly decline.

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