In the first half of 2023, the price trend of domestic refined oil market was differentiated. The price of gasoline at the beginning of the year was 7,477.6 RMB/ton, and the mid year price was 8,478.6 RMB/ton, with a price increase of 13.39% in the first half of the year; The price of diesel at the beginning of the year was 7,180.2 RMB/ton, while the mid year price was 6,806 RMB/ton. The price decreased by 5.21% in the first half of the year, and the trend of gasoline and diesel has diverged.

Gasoline: In the first half of 2023, the domestic gasoline market showed an upward trend, with a growth rate of 13.39% in the first half. In January, due to the impact of the Spring Festival holiday, gasoline demand was supported by the Spring Festival transportation, and the gasoline market significantly rose.

The gasoline market maintained a volatile operation from February to June, during which crude oil prices fluctuated widely and demand remained relatively stable. During this period, it was supported by holidays such as Qingming Festival, May Day, and Dragon Boat Festival. In addition, as the temperature increased in June, the use of automotive air conditioning increased to ensure gasoline demand. In addition, the monthly average production of refined gasoline in Shandong in the first half of 2023 was 2.4856 million tons, a decrease of 2.35% compared to last year, and gasoline inventory also decreased accordingly, Positive factors supported the upward trend of the gasoline market in the first half of the year.

Diesel: In the first half of 2023, the domestic diesel market price trend declined, and the main influencing factors in the first half of the year were as follows: firstly, the cost side crude oil market price declined. In the first half of 2023, international crude oil fluctuated widely and showed an overall downward trend, with WTI falling by 10.89% and Brent crude oil falling by 10.72%. After May, the market volatility range narrowed and gradually bottomed out and stabilized. Secondly, the supply side has increased. The cumulative diesel production from January to May 2023 was 89.307 million tons, a year-on-year increase of 20.3%; In the first half of 2023, the monthly average production of refined diesel in Shandong was 4.7034 million tons, an increase of 18.63% year-on-year, and an increase in supply side was negative for domestic diesel market prices. Thirdly, there is a phenomenon of accumulation in diesel inventory. The diesel inventory of Shandong Refinery is below the warning line of 35%, but due to poor demand, the diesel inventory continued to rise in June, and the diesel market was suppressed. Finally, the demand side is relatively weak. Mainly in infrastructure engineering and mining, infrastructure is mainly due to a lack of funds for new construction projects, coupled with restrictions on outdoor construction as temperatures rise, while logistics performs poorly due to lower shipping costs; Poor diesel demand is a major bearish factor.

The trend of domestic refined oil prices is influenced by changes in crude oil, and international oil prices are one of the important factors affecting domestic refined oil prices. The overall decline of crude oil in the first half of the year was due to fluctuations, mainly due to the suppression of demand. This is inseparable from the overall external macro environment. This round of Fed rate hikes has entered the second half and has now reached the range of 5-5.25. The high interest rate environment is very obvious in suppressing demand. Although inflation in the United States has currently dropped to 4%, based on past experience, the target value is 2%, and the Federal Reserve's recent stance is still relatively hawkish, indicating that there may be one or two interest rate hikes in the future, and the weakening demand expectation will further suppress crude oil. In the first half of 2023, international crude oil fluctuated widely and showed an overall downward trend. WTI fell by 10.89%, while Brent crude oil fell by 10.72%. After May, the market volatility range narrowed and gradually bottomed out and stabilized.

In 2023, the retail prices of domestic refined oil products underwent thirteen price adjustments, with five increases, six decreases, and two stalls. Overall, in the first half of 2023, gasoline was reduced by 25 RMB, while diesel was reduced by 25 RMB. In the first half of 2023, the retail price of refined oil products decreased slightly.

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