The overall trend of the domestic MTBE market is showing a rise followed by a decline. From April 12th to 19th, the price of MTBE first rose from 7,512 RMB/ton and then fell to 7,562 RMB/ton, with a price increase of 0.67% during the cycle and a maximum amplitude of 1.83%. The month on month increase was 7.65%, and the year-on-year decrease was 1.63%. The price increase in the first half of the week is closely related to the escalation of geopolitical risks. Business owners are optimistic about crude oil, while gasoline prices have risen, and MTBE has followed suit. However, geopolitical conflicts have slowed down, and international crude oil has fallen. In addition, the supply of MTBE resources has increased, and Lihua Yi, Shenchi, Luqing and others have all resumed export sales. Spot supply has increased, but demand has not followed suit significantly. The second half of the week saw a pullback and consolidation.
Cost side: Narrow decline in crude oil prices
International crude oil: Currently, the environment in which crude oil operates is relatively complex, and the performance of oil prices is also relatively stagnant and anxious. Macro and demand are suppressing oil prices in the short term, and the space for further upward movement of oil prices is being suppressed. In addition, given that the current geopolitical tensions have not escalated, crude oil has the potential to mitigate risk premiums and reshape valuation expectations. But the risk has not been lifted, coupled with the start of the North American driving season, gasoline demand is expected to rise, which will provide support for oil prices. Overall, the supply and demand game in the oil market will intensify in the short term, and there is a greater possibility of oil prices maintaining high volatility. As of April 18th, the settlement price of Brent crude oil futures main contracts was reported at $87.11 per barrel, a decrease of $0.18 or 0.2%.
Demand side: The rise of the gasoline market has led to an increase in MTBE procurement
In terms of gasoline, as the May Day holiday approaches, end-users have a certain demand for stock, but the supply of MTBE resources is still relatively high. Short term MTBE demand is influenced by bearish factors.
Supply side: Device maintenance gradually resumes and production increases
Dongying Qifa, Minghao Chemical, Shandong Yuhuang, Qingzhou Tianan, Binzhou Jingbo and other facilities are currently in shutdown. After the start of the Anqing Taifa facility, production has significantly increased. Shandong Shenfa and Qingzhou Tianyi are scheduled to start construction on April 18th, but no products have been produced yet. Next week, as Lu Shenfa and Qingzhou Tianan start producing products, it is expected that production will increase. Short term domestic MTBE supply is affected by bearish factors.
Foreign markets tend to rise, with concentrated outbound shipments moving faster
As of the close on April 18th, the closing price of the Asian MTBE market has decreased by $30.09 per ton compared to the previous trading day, while FOB Singapore closed at $974.99-976.99 per ton. The closing price of the European MTBE market has decreased by $17.25 per ton compared to the previous trading day, while the FOB ARA closed at $1,143.24-1,143.74 per ton. The closing price of the US MTBE market has decreased by $5.33/ton compared to the previous trading day, while the FOB Gulf offshore price closed at $996.72-997.08/ton (280.77-280.87 cents/gallon).
In the future, there is an expectation of an increase in resource supply, and a wave of demand for gasoline will be expected during the holiday. Under the long short game, MTBE analysts from SunSirs believe that the domestic MTBE market may consolidate and observe in the short term.
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