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Toluene and xylene: the outlook of the two benzene market

Views: 0     Author: Site Editor     Publish Time: 2022-09-15      Origin: Site

Toluene and xylene: the outlook of the two benzene market

In terms of raw materials and the periphery, the US government is reluctant to see crude oil prices return to the low oil price range again, because this may lead to a more severe supply contraction and brew a stronger price rebound. In line with expectations, negotiations on the Iran nuclear deal were once again deadlocked. US Secretary of State Blinken said that Iran's response to the EU nuclear deal proposal made an agreement unlikely in the near future. The United States once again implemented measures against Iranian individuals and entities this week In the face of sanctions, Israel is actively lobbying Western powers to prevent a deal, and the probability of a nuclear deal with Iran has dropped sharply in the short term.

 Another event that needs to be closely watched is that the United States may have the first strike of railway workers in 30 years. Its impact on the operation of oil prices remains to be seen, but this will exacerbate energy commodity supply chain problems. In addition, the uncertainty of the Russia-Ukraine war will increase. The escalation of conflicts in Armenia and Azerbaijan has increased the complexity of the geopolitical situation. The rebound of crude oil at the high oil price threshold reflects the resilience of crude oil prices. Under the situation that local supply is still tight, the probability of crude oil prices falling to the low oil price range It is extremely weak. Our short-term judgment on crude oil futures prices is that there is a dilemma between upper and lower levels, and the downward resistance is more significant. Strong shocks are the mainstay. The WTI price operating range may fall between $86 and $91 per barrel.

This cycle, the price difference between China and South Korea for toluene and USD has expanded to USD 43/ton. There is still room for arbitrage between China and South Korea. The CFR China toluene conversion price is higher than the market negotiated price in the East China market on Thursday. Port inventories fell this week compared with last week, and the supply side was well supported. On the demand side, the focus of pure benzene was firm during the week, and the price difference of "pure benzene-toluene" narrowed to around -45 yuan/ton compared with last week. The profit of toluene disproportionation was insufficient, and the support for toluene was insufficient; refined oil products fell this week, and toluene related adjustments were made. The oil demand is light; the TDI market is firm and organized, and the intention to purchase raw materials is acceptable; the overall demand side support is limited. It is expected that toluene will be mainly sorted in the short term.

This cycle, the price difference between CFR China and FOB South Korea in the USD xylene trade is about -21 USD/ton, and the anti-arbitrage space is open. The conversion price of CFR in China is lower than the price negotiated in the isomerized xylene market in East China on Friday, and the U.S. dollar market is negatively dominated. From the perspective of supply, port inventories have rebounded within a narrow range, and the recent new production capacity is expected to be put into the market, and the supply side is supported flat; from the demand side It can be seen that the overall start-up of PX rose to about 77.59% in a narrow range, and the support for isomerized xylene was general. The oil market was light during the week, and the support for paraxylene was insufficient. It is expected that xylene will run mainly in a short period of time.

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