SunSirs: China Refined Naphtha Market Showed an Inverted V-shaped Trend in April

According to the Commodity Analysis System of Business Society, the market for refined and hydrogenated naphtha in April first rose and then fell, with an overall slight decline. As of April 30th, the mainstream ex factory price of refined and hydrogenated naphtha in China was 8,376.50 RMB/ton, a decrease of 0.21% from 8,394.00 RMB/ton at the beginning of this month. The market for locally refined straight run naphtha first rose and then fell, with an overall slight upward trend. As of April 30th, the mainstream ex factory price of domestically refined straight run naphtha was 8,349.00 RMB/ton, an increase of 0.78% from 8,284.00 RMB/ton at the beginning of this month.

Product: In April, the overall market for refined naphtha showed an inverted V-shaped trend. Currently, the mainstream price of refined hydrogenated naphtha is around 8,400 RMB/ton, and the mainstream price of straight run naphtha is around 8,300 RMB/ton. In the first half of April, the rise in international crude oil supported the naphtha market, while the related gasoline market showed positive performance. In addition, some local refining enterprises are currently mainly shut down for maintenance and self use, and the pressure on refineries is limited, resulting in high support; In the second half of the month, the international crude oil market fell from a high level, increasing the wait-and-see sentiment of domestic naphtha. Terminal trading of ground refining naphtha is limited, and market trading is still concentrated in the gap of ground refining restructuring.

Upstream: The crude oil market in April was volatile, and the instability of the current situation in the Middle East still has a certain positive impact on oil prices. This will keep oil prices at high levels, and the resistance to a significant decline in the future is still significant. In addition, the current demand side has also shown some positive expectations, and the peak driving season in North America will stimulate gasoline demand. The decline in US crude oil and finished oil inventories has also provided support for oil prices.

Downstream: The toluene market rose and fell in April. The international crude oil price fluctuates at a high level, and the cost of toluene continues to support; Downstream demand for disproportionation and blending is lower than expected, with weak support for toluene demand; The high level of port inventory has a bearish impact on the toluene market. In April, domestic PX production declined and the market remained stable. In mid to early April, some devices were shut down for maintenance, and PX production decreased from 8.4% to around 6.9%; In mid to late April, some maintenance equipment restarted, and the domestic PX production slightly increased to around 7.1%.

Energy analysts from Business Society believe that the international crude oil market has fallen from a high level, increasing the wait-and-see sentiment for domestic naphtha; At present, the terminal trading of ground refining naphtha is limited, and market trading is still concentrated in the gap of ground refining restructuring; In terms of gasoline, it is difficult to increase the operating rate of refineries in the short term. With the arrival of the May Day holiday, there will be an increase in residents' travel. In addition, with the rising temperature, there will be an increase in fuel consumption, ensuring the demand for gasoline. There is also room for a slight increase in gasoline prices; The demand for diesel has not changed much, and the travel of hazardous chemical vehicles during holidays is limited. In addition, the bearish mentality of traders has increased, and the willingness to ship is strong. It is expected that the short-term diesel market will mainly fluctuate and decline. Overall, it is expected that the post holiday refined naphtha market will mainly consolidate.

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