Prices of refined oil | were strongly supported by falling production profits

Recently, the Shandong refined oil market realized strong resistance, and the closing settlement price of crude oil closed down for two consecutive days, but the gasoline and diesel prices were basically stable. As of May 22, the market price of gasoline in Shandong independent refinery was 8,557 yuan/ton, and the price of diesel was 7,203 yuan/ton, which was basically the same as the price on the 19th, while the price of Brent crude oil fell by $1 / barrel. The main reason is that since the beginning of the year, the supply of gasoline and diesel oil in Shandong refineries has continued to be at a low position, especially last week's operating rate has also declined significantly, and the low supply has increased the willingness of refineries to support prices.

 

 

（Capacity utilization chart of atmospheric and vacuum equipment in Shandong province）

 

According to Longzhong data statistics, the weekly average capacity utilization rate of atmospheric and vacuum in Shandong independent refineries was 54.89%, down 5.28 percentage points from the beginning of the year, down 4.51 percentage points year-on-year. It is expected that the operating rate of Shandong independent refinery in early June will fall to about 50%, mainly because Hualong, Tianhong and Dongming have maintenance plans in late May and early June, and the operating rate will hit a new low in the past two years.

 

The main reasons for the lower operating rate than last year are the following two points, first, since the beginning of the year, Shandong refining profits have fluctuated lower, the average profit from January to May was 288 yuan/ton, while the profit in the same period last year was 980 yuan/ton, down 692 yuan/ton or 70.61%. Second, the decline in diesel demand, the main infrastructure mining operation rate is low to pull down diesel demand, and LNG heavy truck sales continue to rise, its transportation costs are much lower than diesel. It is estimated that the cost of LNG heavy truck within the five-year cycle is basically the same as the cost of fuel in a year, that is to say, the cost of LNG heavy truck will be returned in a year, and the remaining four years will basically have at least 150,000 / year profit, so the market replacement of LNG has become the biggest obstacle to diesel consumption.

 

Corresponding to the price point, in terms of gasoline, although the current demand for gasoline is poor, gasoline demand in June is expected to improve, and under the current production reduction expectation, the price resistance is strong. However, after entering June, the use of vehicle air conditioning will increase, gasoline demand will pick up, between the existence of gasoline adjustment and supplement, the decline in production or far less than diesel, so the refinery production reduction on gasoline prices or less than diesel, gasoline prices in June or a high probability of a small rise in space.

 

In terms of diesel, although the current demand for diesel is poor, more maintenance is expected to support the bottom of diesel prices. After entering June, with the increase in the number of maintenance refineries, the space for supply reduction is larger, and the price of diesel oil may have room to rise by about 300 yuan/ton.