As of June 19, the average ex-factory price of domestic main refined and hydrogenated naphtha was 4,500 RMB/ ton, down 1.69% from 4,580 RMB/ ton at the beginning of the week, and the actual transaction price of refined and hydrogenated naphtha was about 4,400-4,500 RMB/ ton

On June 18, the naphtha commodity index was 55.79, down 0.49 points from the previous day, down 45.63% from 102.62 (2012-09-24), the highest point in the cycle, and up 32.08% from 42.24, the lowest point on July 19, 2016. (Note: cycle refers to 2012-09-01 to now)

Analysis of Influencing Factors

Last week, the price of refined naphtha fell slightly and the inventory was sufficient.

Upstream: according to the monitoring of SunSirs, U.S. WTI crude oil was $37.12/ barrel at the beginning of the week, $39.05/ barrel at the end of the week, with a weekly increase or decrease of more than 5%; Brent crude oil was $39.72/ barrel at the beginning of the week, $41.51/ barrel at the end of the week, with a weekly increase or decrease of 4.80%. At the OPEC+ ministerial meeting, the assessment of the record production reduction agreement released a signal of increased implementation rate of production reduction, offsetting some emotional disturbance of demand concerns caused by COVID-19. Crude oil prices continued to fluctuate at high levels, and the naphtha drop was mostly affected by the sharp drop in crude oil prices last week.

Downstream: according to the monitoring of SunSirs, the domestic toluene market price dropped last week. As of last Friday, the domestic average price was about 3,550 RMB/ ton, down 2.47% from the previous week. Last week, the domestic xylene market price also declined. As of Friday, the domestic average price was about 3,650 RMB/ ton, down 2.39% from the previous week. The domestic inventory pressure is gradually prominent, and the risk of oversupply is once again hyped.

Future Forecas

According to energy analysts of SunSirs, last week's naphtha refining fell slightly, with sufficient inventory and general downstream purchasing sentiment. It is expected that the price of naphtha refining and hydrogenation will continue to decline in the near future, with the average price range of 4,100-4,400 RMB/ ton.

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