According to the monitoring of nickel prices by business associations, nickel prices soared again on July 18, with spot prices rising by 4.48% in a single day, breaking through the 110,000 mark, rising by 4.77% year on year and 28.31% over the 89,508.33 yuan/ton at the beginning of the year. The main nickel market in Shanghai opened at 11830 yuan, then the price rose sharply, touching the price limit in the morning, and then unlocked, closing at 16870 yuan, up 5.24%. LME closed its March nickel submission at $14,840, up 3.23%.

Nickel is still at a historic low

The nickel commodity index on July 18 was 69.55, up 2.98 points from yesterday, down 30.45% from the peak of 100.00 points in the cycle (2011-09-01), up 78.10% from the lowest point of 39.05 on November 24, 2015. (Note: Period refers to 2011-09-01 to date)

After four months of falling nickel, the market finally won. Nickel has been soaring since July, and today it is soaring nearly five points. One of the reasons is that the supply side disturbances occur frequently, the previous edition has specifically analyzed the link: business associations: nickel supply shortage news continued to ferment stainless steel slightly followed the rise. On the other hand, the steelmakers deliberately make high nickel prices.

Let’s first look at the price rises and falls of stainless steel and nickel in the industrial chain.

According to the rising trend chart of the stainless steel industry chain of business associations, from the beginning of the year to the end of the 18th, nickel prices rose by 28.31%, stainless steel only slightly increased by 1.56%. It shows that the price elasticity of stainless steel is less than that of nickel. In the historical market, when nickel price fluctuates greatly, the price of stainless steel can still operate relatively independently. According to this logic, if the price of stainless steel remains unchanged after nickel price rises, the profit of steel mills will shrink or even suffer losses. In fact, 17 years ago, when the price of nickel soared frequently, the price of stainless steel was relatively calm. You rose little, I did not move. You rose little, I rose little, previously thought that the poor demand downstream caused. But until Tuesday (16), large stainless steel factories entered the market to purchase nickel sheets. On the 17th, stainless steel rose by 3.06% for two consecutive days, as shown in the figure below.

According to the nickel price monitoring of business associations, the market of stainless steel has been depressed this year. By June, several large steel mills began to make joint bids. The method is to increase the price of stainless steel while increasing the nickel price. This gives a plain reason for the price increase of stainless steel (the rising price of raw materials leads to higher costs), which is due to the fact that large steel mills have already made joint bids. As the cost is relatively locked up after the stock is prepared in advance, the steel mill can achieve double revenue at the futures and spot ends in the market where the prices of stainless steel and nickel rise resonantly. In addition, although nickel prices have been rising for many days to reach the highest level in the year, there are still a large number of steel mills purchasing nickel plate spot.

Future forecast: In the context of no significant change in supply and demand, the recent sustained rise in nickel prices is closely related to the positive measures taken by large stainless steel plants and frequent interference at the supply side. But in fact, the earthquake in Indonesia, restrictions on mineral exports and environmental protection factors in the Philippines have not significantly affected the spot market. However, this wave of increase has been coordinated by stainless steel factories, large stainless steel factories into the market to purchase steel factories, resulting in a sustained rise in nickel prices. However, after the purchasing boom in large stainless steel plants, prices may gradually stabilize. Recent nickel market is short-term, it is difficult to sustain the sustained rise in nickel prices, the future market is concerned about whether there are new disturbances at the supply side.

Peter, head of natural gas, coal and electricity markets at the International Energy Agency (IEA)? Peter Fraser, introducing the latest report of the International Energy Agency (IEA) on the natural gas market on June 16, said that China’s natural gas production is expected to increase by 82 billion cubic meters by 2024, about 50% more than that in 2018.

Fraser told reporters that this production forecast includes both conventional and unconventional gas production growth. China’s natural gas exploration and development activities increased significantly in 2018, and it is expected that China’s natural gas production will achieve this growth.

Fraser said that China’s recent announcement of opening up its oil and gas exploration and development business to foreign investors will undoubtedly benefit China’s domestic production.

The International Energy Agency predicts that Asia will continue to lead the growth of global natural gas consumption in the next five years. China is expected to account for 40% of the growth of global natural gas consumption and will become the world’s largest LNG importer in 2024. The United States, China and Middle East countries will dominate the growth of global natural gas production, while the growth of natural gas exports will mainly come from the United States. China and Russia, the United States will produce 1 trillion cubic meters of natural gas in 2024, and become the largest LNG exporter in the world.

Fraser also believes that despite the convergence of spot gas prices in North America, Europe and Asia this year, it is still too early to say that the integration of global gas market prices, and winter weather may soon pull gas prices in different regions apart again.

Leslie Palti-Guzman, founder and President of GasVista, a LNG market consultancy, said that due to problems such as excessive technology and market supply, construction of several LNG projects in the United States has been delayed to varying degrees. The ability of China, India and Pakistan to absorb new LNG supply is limited, and LNG exporters need to develop new small markets from South America.

Ella, head of S&P’s global natural gas and power business? Ira Joseph said that the price gap between the United States and Asia-Pacific LNG did not support exports to the Asia-Pacific market because of the sharp decline in LNG prices in the Asia-Pacific region. At present, the United States mainly exports LNG to the European market.

On July 17, 2019, the price of fluorine chemical industry rose and fell in the list of 10 commodities, fell in the list of 10 commodities, rose and fell in the list of 5 commodities. Stable products include trichloromethane, hydrofluoric acid, fluorite, aluminium fluoride and cryolite.

On July 17, the market price trend of fluorine chemical raw materials was temporarily stable. The price of fluorite raw materials was 3150 yuan/ton. Recently, some domestic fluorite plants started to work normally. Mines and flotation plants in the field started to work normally. The supply of fluorite in the field was tight. However, the recent downstream market has risen, and the price of fluorite has been affected to rise. In the southern fluorite market, the start-up of installations is general, and the price of fluorite market in the southern region has risen. As of the 17th, the domestic price of fluorite in Inner Mongolia was 2900-3100 yuan/ton, the mainstream of fluorite negotiations in Fujian was 3000-3300 yuan/ton, the price of fluorite in Henan was 3000-3300 yuan/ton, and the price of fluorite in Jiangxi was 3000-3300 yuan/ton.

Recent downstream refrigerant industry trend is general, the starting rate remains low, the demand for hydrofluoric acid is general, but due to the reduction of on-site supply, the market price trend of hydrofluoric acid is rising. As of the 17th day, the market price of hydrofluoric acid is 12080 yuan/ton. Recently, the market price of hydrofluoric acid is rising, and the domestic starting rate of hydrofluoric acid is less than 60%. More, enterprises reflect that the supply of hydrofluoric acid on the spot is adequate and regular. Recently, the market of hydrofluoric acid on the spot has improved. Some enterprises’ex-factory prices have risen slightly. Until now, the mainstream of hydrofluoric acid negotiations in the southern region is about 11500-12500 yuan/ton, while the price of hydrofluoric acid in the northern market is about 11500-12500 yuan/ton. However, people in the field reflect the near future. Hydrofluoric acid market price trend is stable, Business Analyst Chen Ling believes that the market for hydrofluoric acid may be temporarily stable.

The price trend of aluminium fluoride products is temporarily stable, the supply on the market is normal, and the trading market is general. The quotation of aluminium fluoride from Zhengzhou Tianrui Grain Technology Co., Ltd. is 11,000 yuan/ton. The quotation of aluminium fluoride from Shandong Luzeng Chemical Co., Ltd. is 10,800 yuan/ton. The quotation of aluminium fluoride from Zhengzhou Zerun Energy Chemical Co., Ltd. is 9,800 yuan/ton. The quotation of aluminium fluoride Aluminum fluoride quoted 9500 yuan/ton.

Recently, the price of trichloromethane in Shandong has been temporarily stable. The ex-factory price of trichloromethane enterprises is around 3050 yuan/ton. The start-up rate of production is low. The 440,000 tons/year plant in Jinling, Shandong Province, has started normal operation. The 120,000 tons/year plant in Jinmao, Dongying, has been overhauled. The 220,000 tons/year plant in Luxi Chemical Industry has started 60 percent. The supply of trichloromethane production enterprises in China is relatively tight. Inventory is low.

In recent years, the price trend of domestic cryolite is temporarily stable, the operation of on-site equipment is stable and the supply is normal. The domestic negotiation price is about 6500-7000 yuan/ton. The actual transaction price is mainly negotiation. Generally speaking, the recent market of fluorine chemical industry is general, and it is expected that the trend of fluorine chemical industry will remain turbulent in the later period.

On Friday, July 12, the IEA of the International Energy Agency released its monthly oil report, which attracted much attention from the market. The organization expects that non-OPEC production led by the United States will grow faster than global demand for crude oil, limiting upward space for today’s international oil prices.

According to the IEA report, in the first half of 2019, the global crude oil market has fallen into a pattern of oversupply, with crude oil supply exceeding demand by 900,000 barrels per day. The excess supply will accumulate into already large stockpiles of crude oil, which began to take shape in the second half of last year, when global crude oil production surged, but demand growth began to swing.

Neil Atkinson, head of IEA’s crude oil industry and market department, pointed out that the prospects for the second half of this year and 2020 are “considerable oversupply of crude oil”, mainly due to the substantial increase in production from the United States and other countries:

“OECD commercial crude oil stocks increased by 22.8 million barrels per day in May to a total of 2.906 billion barrels, 6.7 million barrels higher than the five-year average. If OPEC output remains unchanged at the current level of 30 million barrels per day, it will increase global crude oil inventories by 136 million barrels by the end of the first quarter of 2020. OPEC + last week extended the existing agreement to cut production by 1.2 million barrels per day to March 2020, without changing the basic outlook for oversupply. The oil market is still a long way from rebalancing. At present, the oil market is not tightening. Any rebalancing action must continue.

The IEA said that the global crude oil supply exceeded 500,000 barrels per day in the second quarter of this year, compared with the expected supply gap of 500,000 barrels per day. This is mainly due to the “extraordinarily weak” demand for crude oil in the first half of the year, with global oil demand growing at 310,000 barrels per day in the first quarter and 800,000 barrels per day in the second quarter.

The report predicts that global oil demand growth will rebound to 1.8 million barrels per day in the second half of the year, with an average annual growth rate of 1.2 million barrels per day as a result of improved economic activity and accelerated operation of petrochemical plants. Global oil demand growth will rebound further to 1.4 million barrels per day in 2020, which is on the same level as last month’s forecast, but smaller than this year’s global crude oil supply. Average growth of 2 million barrels per day and supply growth of 2.1 million barrels per day next year.

Given the slowing rebalancing process in the global oil market, the organization expects that the pattern of over-supply in the oil market will continue until 2020, with supply growth of 2.1 million barrels per day largely coming from U.S. -led capacity expansion of non-OPEC organizations. The decline in demand for OPEC crude oil in the first three months of next year is expected to force OPEC production to drop from 30 million barrels a day to 28 million barrels a day, the lowest since the third quarter of 2003.

Observations show that the conclusions of the IEA report are consistent with the monthly report issued by OPEC on Thursday. OPEC had predicted that global oil consumption would continue to grow at the rate of 1.1% this year, about 1.1 million barrels per day in 2020. Under the pressure of non-OPEC supply represented by American shale oil, global demand for OPEC crude oil was expected to decrease by 1.34 million barrels per day to 29.27 million barrels per day, the third consecutive year of sharp decline.

Analysts say the demand figure is much lower than the output of OPEC’s 14 member countries last month of 9.83 million barrels per day, which means that simply extending existing production reduction agreements or failing to prevent new oversupply in the global crude oil market. Another embarrassing situation facing OPEC is that member countries rely on production cuts to support oil price efforts, instead providing opportunities for competitors such as U.S. shale oil to nibble up global market share.

The IEA stressed that the monthly oil report reflects the recent focus of market attention on the topic of “demand growth”. Although the organization has not lowered its global GDP growth expectations for the time being, there are signs that trade and manufacturing activities are deteriorating. Global manufacturing output fell in the second quarter for the first time since late 2012; new orders fell faster. At the same time, European oil demand is weak, aviation industry is facing development difficulties, and the demand for gasoline and diesel oil in the United States also fell in the first half of the year on a year-on-year basis.

According to Reuters analysis, the IEA report shows that U.S. oil output growth will exceed the sluggish growth of global demand, leading to a global backlog of large crude oil inventories in the next nine months, which seems to be anticipating that OPEC and its allies will have to step up production cuts. According to U.S. News and World Report, strong U.S. production and exports and poor global demand will keep oil prices weak by 2020. Brent’s oil price has fallen by $10 to $15 from the same period last year. The IEA expects oil prices to fall by 8% in 2020 compared with the level in 2018.

But Steven Kopits, managing director of Princeton Energy Advisors, does not fully agree with the IEA. In his view, U.S. crude oil production growth seems to be slowing down compared with last year, and inventories of crude oil and finished oil are also decreasing. This week’s data show that American oil rigs, according to Baker Hughes, have fallen for two weeks, while EIA crude oil and gasoline stocks have fallen for four weeks.

According to financial media CNBC, WTI and Brent oil prices will increase by more than 4% this week, reversing last week’s decline. One hour before Friday’s close, WTI August futures rose 0.3% to $60.39 a barrel, hitting a daily high of $60.74, the highest since May 22, while Brent September futures rose 0.5% to $66.81 a barrel, hitting a daily high of $67.28 since May 30.

Later this week, oil prices in the United States accelerated, driven by the Fed’s expectations of interest rate cuts, as well as the impact of bad weather on crude oil production.

U.S. stocks fell more than 0.2% in midday trading on Friday, and the dollar index fell to 96.846 on the refresh day, 27 points lower than the day’s high, approaching the 200-day average of 96.774. According to Xinhua News Agency, Tropical Storm will hit the United States, Trump declared a state of emergency in Louisiana. Crude oil production in the Gulf of Mexico has fallen by more than 1 million barrels per day or by 53%.

The 16th China International Polyester Summit Forum was held in Shanghai recently. At the forum, more than 20 polyester-related enterprises and traders from home and abroad made in-depth analysis of the upstream and downstream products of the polyester industry chain.

Futures Daily reporters learned at the meeting that in the first half of the year, in anticipation of the decline in global economic growth, the domestic commodity market as a whole showed a trend of oscillation, crude oil volatility was more intense, and the PPI index continued to decline slightly. Profit distribution of polyester industry chain is shuffled again, PTA rollercoaster market again, and profits expand substantially in the case of tight liquidity. Under the influence of demand withdrawal, the profits of polyester products shrink significantly. MEG is “stagnating” in the face of huge production expectations. In addition to PTA, the other products in the industrial chain fell significantly in the first half of the year.

According to the data of China Fiber Network, PTA maintained high-load production under high profit in the first half of 2019, and its output growth rate reached 9.4%. With two rounds of large-scale production reduction of polyester in the beginning of this year and May, PTA stock accumulation degree was relatively high, and the accumulative increase of social stock nearly doubled in the first half of this year. In addition, the volume of imports increased under the high price of the inner plate, with imports growing by nearly 18% in the first half of the year.

“In the first half of the year, the import growth rate of MEG declined to 2.6% under the dramatic expansion of output growth, but the high inventory still drags down the absolute price, and the profits of MEG in all ways are very poor.” Zhao Cheng, head of polyester industry chain of medium-fibre mesh, said.

At present, the overcapacity of the polyester industry chain has been gradually alleviated, and the near future prospects are still fragile. R.D. Udeshi, president of the polyester chain of Sincerity Industries Ltd., India, said that compared with previous data, it was found that the profits of the industrial chain offset the impact of large price fluctuations and reduced the downside risk. Subversive capacity deviation will benefit the polyester industry chain in the next few years. PX, PTA and MEG will be adjusted in the future due to the increase of production capacity, and stable demand growth will support the operation of the device.

In fact, more market participants are pessimistic about the chemical industry. Jason Miner, senior analyst at Bloomberg Global Chemistry, argues that a slowdown in demand for chemicals is inevitable and that oversupply may exacerbate the decline in earnings.

Some market participants believe that China officially opened the prelude of the year of refining and chemical industry in 2019, and a number of PX units are waiting to be put into operation. PTA will enter a new round of expansion cycle after 2019, which may become the last year of PTA low inventory. In 2020, PX is still in the peak period of production, PTA production capacity may usher in a major outbreak, and the number of new polyester production capacity is expected to remain at the level of 2019.

In this regard, Zhao Cheng said that the “integration” of PX-PTA industry chain will be further deepened, and the deepening of integration will also enhance the profitability of polyester factories. The concept of PX-PTA-polyester interests bundling is becoming increasingly solid, and the three links will enjoy a growth of overall profits.

Looking ahead to the second half of the year, Zhao Cheng said that in the case of trade friction eased, demand in the second half of the year will be in a slow recovery state, but orders flowing to Southeast Asia and other places from last year to now are temporarily irreversible. The growth rate of demand for polyester is expected to be 6%-7% for the whole year, and the growth rate of production is expected to be 9%-10% in optimistic circumstances. In the second half of the year, PX’s new capacity was put into operation at a slower rate than expected, and its profit enlargement and further withdrawal were likely to be smaller. The liquidity of PTA ensures that PTA is still a better multi-product in the chemical industry sector in anticipation of the increase of social reservoirs.

On the 15th, the Ministry of Natural Resources learned that the proven reserves of oil and gas in China stopped falling and rebounded last year, adding a 100 million ton oil field, three hundred billion square gas fields and a 100 billion square shale gas field.

The Ministry of Natural Resources issued a national report on oil and gas exploration and exploitation in 2018 on the same day, showing that China’s oil reserves increased by 959 million tons last year, an increase of 9.4% over the same period last year. Among them, there are three basins with newly proved reserves of more than 100 million tons, namely, Ordos Basin, Bohai Bay Basin (onshore) and Junggar Basin, and one oilfield with newly proved reserves of more than 100 million tons is Heshui Oilfield in Ordos Basin.

The new proved geological reserves of natural gas are 83.157 billion cubic meters, an increase of 49.7% over the same period of last year. Among them, there are two basins with proven reserves greater than 100 billion cubic meters, namely, Ordos and Tarim basins. There are three new gas fields with proven reserves greater than 100 billion cubic meters, namely Sulige gas field in Ordos Basin, Mizhi gas field and Krasu gas field in Tarim Basin.

The report shows that China’s oil and gas production has steadily increased. In 2018, China’s oil production reached 189 million tons, down 1.2% year on year. Basins with output of more than 10 million tons include Bohai Bay (including sea area), Songliao, Ordos, Junggar, Tarim and Pearl River Mouth basins, totaling 176 million tons, accounting for 92.8% of the total national output.

Natural gas production in China was 14.512 billion cubic meters, an increase of 6.4% over the same period last year. Among them, the basins with output of more than 3 billion cubic meters are Ordos, Sichuan, Tarim, Qaidam, Songliao and Pearl River Mouth basins, totaling 126.346 billion cubic meters, accounting for 89.3% of the national total.

According to Pratt Energy Information Singapore, industry sources said that due to new demand in the spot market, confidence in the Asian gasoline market has increased and market fundamentals have been supported, driving gasoline prices to a nearly two-month high in August/September.

In the derivatives market, Singapore’s August/September 92 RON gasoline spread widened to 95 cents/barrel on Wednesday, rising an average of 12 cents/barrel per day. According to S&P Global Platts, it has risen 31 cents per barrel since early July.

In terms of direct prices, Singapore’s 92 RON gasoline August swap price surpassed the $70/barrel threshold, at $70.77/barrel, the highest level since May 30, 2019 (then $71.50/barrel).

Next, the spreads remained positive in the fourth quarter and the first quarter. On Wednesday, Asian markets closed at 53 cents a barrel, up 12 cents a barrel since early July.

According to Pratts data, Singapore’s gasoline swap price in August was 62 cents per barrel per day, or $5.65 per barrel, higher than Brent’s crude oil swap price, which measures the relative value of the product to crude oil.

The increase in spreads could even continue into Thursday’s trading day, with market participants saying that the August swap price of 92 RON gasoline could be kept above $6.50 a barrel, significantly higher than the $5.40 a barrel level at Asian closing on Wednesday.

Sources pointed out that in line with the rise, spot market spreads have also steadily risen since early July, as real-time demand in parts of Asia has supported oversupply markets.

On Wednesday, at 8:30 GMT, Singapore’s FOB Singapore 92 RON gasoline settled at $7.13 a barrel against the ICE Brent crude oil futures in recent months, just one cent lower than the three-month high of $7.14 a barrel set on July 5.

Demand came from the Philippines and Vietnam, where buyers sought immediate oil supplies on the spot market after news of domestic refinery problems.

Earlier Pratz reported that the Bataan refinery, which produces 180,000 barrels a day, would extend its production cycle to late August, while the Naghi-Son refinery, which produces 200,000 barrels a day in Vietnam, would reduce its crude distillation unit to about 50%.

In addition, sources added that the strong rise in RBOB futures on the New York Mercantile Exchange and the subsequent closure of PES Pennsylvania refineries in the United States also boosted oil prices in the Asian market. Since the beginning of July, the average price difference between RBOB and Brent crude oil in the United States has been $16.09 per barrel, significantly higher than that in June of $11.76 per barrel.

Since June, international crude oil prices have shown a trend of first restraining and then rising. The main contract price of NYMEX crude oil futures once rebounded from close to $50 per barrel to above $60 per barrel. Analysts said that under the background of storm warning, the comments of Federal Reserve Chairman Powell “pigeon” faction superimposed on the U.S. over-expected inventory reduction, the strong third quarter operation is still the main theme of crude oil price operation.

Oil prices stopped falling and rebounded

After falling sharply in late May, the main contract price of NYMEX crude oil futures hit a new low of $50.79 per barrel on June 5, and then rebounded, closing at $60.39 per barrel on July 12.

“International crude oil prices consolidated after the end of the fall in early June, during which the Iranian nuclear issue continued to escalate, and the U.S. return to the depot reduction cycle has provided a potential driver for the rise in oil prices. In addition, last week, the U.S. National Hurricane Center issued a tropical storm warning, which reportedly resulted in the closure of some offshore drilling platforms in the Gulf of Mexico, combined with the U.S. unexpected inventory reduction stimulus, oil prices soared all the way to a recent high. Gao Mingyu, chief analyst of CITIC Anxin Futures Energy, and Li Yunxu, senior analyst, said.

In addition, EIA data show that in the week of July 5, commercial crude oil stocks decreased by 94.99 million barrels to 459 million barrels, crude oil production is expected to increase by 100,000 barrels to 12.3 million barrels per day, crude oil exports increased by 58,000 barrels per day, while imports excluding strategic reserves decreased by 283,000 barrels per day. U.S. crude oil inventories accelerated their decline after returning to seasonal trend in June. Analysts said the steady decline in inventories showed the impact of the sharp drop in oil prices at the end of last year on upstream investment, i.e. the number of active drilling rigs declined gradually, production entered a relatively stable period, and output growth declined year-on-year.

Short-term oil prices will run more frequently

From the macro and geographic perspective, Gao Mingyu and Li Yunxu said that the weakening of crude oil demand growth has long been a consensus and fully traded. The possible improvement of the recent international trade situation and the rise of global easing expectations provided a relatively mild environment for oil prices, and the possibility of a sharp fall in the fourth quarter of last year was greatly reduced. The Iranian nuclear issue and US-Iran relations are still escalating. Although the impact on Iranian crude oil exports has been difficult to have a marginal effect, there is still room for fermentation of premium caused by geo-risk.

For the game pattern among oil-producing countries, after 2016, it has completely changed from “prisoner’s dilemma” to “coward’s game”. Saudi Arabia’s best choice is to limit production and ensure price. The game balance determines that the relative stability of OPEC production will be a new normal for a period of time. The possibility of increasing production is low and the supply side is low. The risk of a “black swan” is not high.

For future markets, Li Yanjie, a futures analyst at CITIC Construction Investment Futures, said that overall, OPEC production declines, hurricanes and geo-risk rises resonate, supporting oil prices in the short term or continue.

Gao Mingyu and Li Yunxu believe that although the third quarter crude oil price rise is worth looking forward to, from both the macro and the U.S. market, the driving force of the rise is more from the repair of the earlier pessimistic expectations, the market may not be smooth. Strategically, it is suggested to do more on the low side and grasp the band market.

In May 2019, the price of PVC futures rose to 7160, followed by adjustments. With the end of the small off-season in June, demand began to pick up in early July, inventory fell to a moderate level, and PVC prices were again facing support.

According to the statistics of institutions, the output of PVC decreased by 0.2% from January to May 2019, which is deviated from the expected cumulative annual increase of 7% at the end of 2018. From the historical perspective, the output in January-May 2017 increased by 12.4% year-on-year, the output in January-May 2018 increased by 6.5% year-on-year, the output growth in 2019 was declining year-on-year, and the elasticity of the supply side continued to decrease. In 2019, the growth of PVC supply side was much lower than expected, mainly due to two factors. The first is that in November 2018 and April 2019, two sets of devices that were accidentally accidental have not been restarted, and the reduction at the supply side is greater than the increase in capacity of some devices. The second is due to the impact of safety production, environmental protection inspection and the improvement of safety awareness of enterprises. In May 2019, the amount of maintenance losses exceeded the same period last year. The productivity utilization rate of the plant has been increased to over 80%, and the space for continuous output expansion is small. On the whole, the supply side is lower than the market expectation, which has a positive supporting effect on the price.

From January to May 2019, the apparent consumption of PVC increased by 0.9% year-on-year, mainly due to the net import pattern from January to May. Some imports filled the gap of demand. From the data of supply and demand, output is subtracted and demand is added. Overall, the tight supply and demand pattern exceeds market expectations.

From the PVC inventory data, the PVC inventory began to decline from March 22, 2009. The latest data is more than 30% higher than the same period last year. From the details of inventory, the same-rate increase of inventory is mainly concentrated in several key warehouses in East China, some of which are temporarily non-transferable. The total inventory excludes this part of the inventory, which is not much different from the same period last year, and the inventory has dropped to the medium level since 2016. Traders and terminals do not have a high number of days available for inventory, and have a limited repressive effect on prices.

From the seasonal perspective, the terminal start-up rate declined slightly in June and began to rise slowly at the end of June and the beginning of July, indicating that the demand side began to prepare for the start-up of the peak season of Golden Nine Silver Ten.

Overall, the tight supply and demand pattern of PVC has not changed, which is conducive to the continuous decline of social inventory, and will further weaken the role of price suppression. Seen from the seasonal demand situation, the gradual rise of demand side will support the price to a certain extent.

It was reported that the benchmark crude oil price rose moderately in New York on July 8, but fell in London. Prices of light and low-sulfur crude oil in the United States rose before world oil demand, U.S. oil production and OPEC’s monthly report.

The short-term energy outlook of the U.S. Energy Information Administration (EIA) is scheduled for July 9, and the monthly OPEC oil market report is scheduled for July 11. Traders await the oil market report of the International Energy Agency (IEA) on July 12.

EIA’s Oil Situation Report shows that the United States produced 12.2 million barrels a day in June.

Baker Hughes said the number of oil rigs in the United States dropped to 788, down from 888 in November 2018. The latest number of rigs was announced on July 3 due to the Independence Day holiday in the United States.

Energy prices

On July 8, the price of light, low-sulfur crude oil delivered on the New York Mercantile Exchange in August rose 15 cents to $57.66 a barrel. Contract prices rose 17 cents to $57.76 a barrel in September.

Natural gas prices on the New York Mercantile Exchange fell nearly 2 cents in August to $2.40 per million British heat units.

In August, the price of ultra-low sulphur diesel fell by one cent to $1.89 a gallon. New York Mercantile Exchange restructured gasoline blend prices fell 3 cents to $1.90 a gallon in August.

Brent crude fell 12 cents to $64.11 a barrel in September. In October, prices fell 2 cents to $63.82 a barrel.

July’s gas and oil contracts rose $2.50 to $579.25 a ton on July 8. On July 8, the average price of OPEC crude oil rose by $1.17 to $64.72 a barrel.