At the beginning of the week, the domestic naphtha market was sluggish. The price of straight run naphtha in Shandong was 8,200 RMB/ton, unchanged year-on-year, while the price of hydrogenated naphtha was 8,230 RMB/ton, down 1.56% year-on-year. In the Northeast region, the sales of naphtha are mainly direct supply, with straight run naphtha prices at 8,116 RMB/ton and hydrogenated naphtha prices at 8,456 RMB/ton. What caused the decrease in supply price?

In terms of supply, the operating rate of atmospheric and vacuum distillation in Shandong's refineries was 52.75%, a decrease of 0.34 percentage points from last week. Some refineries in Dongying and Weifang have slightly reduced their load, while others have been operating steadily without any new refineries being shut down. The operating rate of local refineries in Shandong has slightly decreased, but there has been an increase in the outflow of naphtha resources in the market.

In terms of blended oil products, the retail price of domestic refined oil products was lowered as scheduled on July 25th, and the new round of change rate extended negatively. The news continued to pressure the blended market, and the prices of blended gasoline and diesel raw materials continued to decline. At the same time, the market buying and selling atmosphere is average, and oil blending merchants mainly focus on the urgent need for raw material procurement. The average price of blended gasoline in Shandong region is 7,147 RMB/ton, a decrease of 0.22% compared to the previous period; The average price of blended diesel is 6,725 RMB/ton, a decrease of 0.80% compared to the previous period.

In terms of reforming equipment, the monthly operating rate of the reforming equipment was 57.08%, a decrease of 2.87 percentage points compared to the previous period. The increase in shutdowns of refinery reforming units has led to a significant decrease in their operating rate, further affecting the consumption of naphtha.

In terms of solvent oil, during the traditional off-season, the purchasing and sales atmosphere in the solvent oil market is generally average, with many operators entering the market for essential needs. Downstream companies are cautious and cautious, purchasing small orders for essential needs. Refineries continue to lower prices and promote sales, making it difficult for demand to support the naphtha market.

The international crude oil futures prices have dropped significantly, and the news is facing significant pressure from the domestic oil market. And we have not heard of any new inspection and cultivation plants in August yet. It is expected that the operating rate of Shandong's refining industry will rebound at a low level in the short term, and the tightening of naphtha supply may ease. In terms of demand, there is a lack of holiday benefits to boost demand, and downstream purchases of naphtha are still mainly driven by rigid demand.

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