Did the first round of price adjustments in the beginning of the year be stranded in the Northwest Oil City?
As soon as it entered 2020, a “black swan” flew in the international crude oil market, bringing a new start to the oil market this year. From the surge in international oil prices to the plunge, as of now, the comprehensive rate of change of crude oil is 0.61%. The domestic oil price adjustment under high probability may have been stranded, and the Northwest region, which has entered the frog hibernation, will go in the future.
——Introduction Chart 1 Wholesale price trend of refined oil products in Northwest China from 2019 to present
As can be seen from the figure above, international oil prices have oscillated higher on New Year's Day, the United States has killed senior Iranian generals, the situation in the Middle East has increased, the supply has tightened, and the two sides have no intention of starting a war. According to the theory, to a certain extent, it can be better than the market and boost the trading atmosphere of the market. However, the domestic refined oil market, which has always been sensitive to the crude oil market, has a fairly calm performance, and it has entered the northwest surrounded by the snowy fog in advance. It seems that the region has already announced that it has entered the frog hibernation season. Even the "opening" atmosphere pursued by the majors over the years seems to be weakened by security. It is understood that at present only the major main units in Qinghai are in Price reductions are offered on a quarterly basis, and all units are actively stocking.
After the New Year's Day, the entire northwest was trapped by heavy snow and mist. Inner Mongolia was banned from transporting at high and low speeds due to the heavy snowfall in successive days. However, Ningxia, the largest supplier of local fuel units, was forced to eat for several days. Ningxia has also experienced heavy snow in recent days. The snowy days and heavy fog in Shaanxi have restricted the transportation of local road resources, and the production of a refinery in January has dropped by more than 2,000 tons. Resources are mostly transported by railway in Sichuan and other places. The weather returns to normal around the 10th, and road transportation maintains an average daily rate of more than 10,000. The Ningxia refining industry is therefore carrying out a major overhaul at the end of the year to reduce production capacity.
Entering the new natural year, the main sales pressure at the beginning of the year is not great, and it is close to the Lunar New Year. The market is not enthusiastic about trading. When crude oil surges, the refinery will only increase slightly. On the contrary, feedback on the callback of crude oil is more positive, and the weak state of the fundamentals of the refined oil market is unlikely to change. If there is no follow-up support from international crude oil, gasoline and diesel prices may fall easily and hardly rise. And as the Spring Festival is approaching domestic industrial and mining, infrastructure and other outdoor projects will be suspended, the demand for diesel in the northwestern region has basically entered a dormant period. Before the holiday, the market for gas refining and diesel may remain weak. As the market demand becomes weaker, each main unit maintains a weak consolidation, and some units may sometimes have price reduction promotions or save preferential space. (Longzhong Information)