MTBE Market Prices Narrowly Consolidate

August 1st news

According to the commodity market analysis system, from July 28 to August 1, the MTBE price increased from 5025 CNY/ton to 5037 CNY/ton, with a price increase of 0.25% within the period, a month-on-month decrease of 1.47%, and a year-on-year decrease of 25.78%. The Chinese MTBE market showed a narrow range of consolidation; some manufacturers were exporting for port aggregation, and some manufacturers had limited external releases, which provided some support to the market. However, terminal demand for gasoline was weak, and local inspections were strict, leading to general purchasing enthusiasm for related gasoline components by traders, and MTBE manufacturers faced a cold reception in terms of sales. With the continuous rise in crude oil prices, the MTBE price saw a slight rebound under this support, but the extent was quite limited.

Cost Aspect: Regarding crude oil, international oil prices have risen. The main positive factor is the new trade agreement reached between the United States and countries such as the European Union, which has significantly reduced market concerns about tariffs. Additionally, potential supply risks arising from possible new sanctions against Russia by the United States have also provided support for oil prices. As of July 31, the settlement price for Brent crude oil futures contract for September delivery was reported at $72.53 per barrel.

Demand Side: Downstream gasoline markets saw international crude oil futures rebound after hitting a low point, with refined oil prices initially rising and then declining. The main reason was that the early-week rebound in crude oil boosted industry sentiment, coupled with periodic restocking by gas station operators. Meanwhile, refineries took advantage of improved shipments to raise fuel prices. As the weekend approached, although crude oil continued to close higher, due to limited terminal consumption levels at this stage, downstream businesses needed some time to digest their accumulated inventory after concentrated restocking. The demand side for MTBE was influenced by bearish factors.

Supply Side: With Lihuayi manufacturers focusing on port collection and not selling externally, and with the Dongming Qianhai facility planning a shutdown, resource supply is decreasing. In the short term, factors affecting the supply of MTBE in China are positive.

As of the close on July 31, the Asian MTBE market closed at $684.71-$686.71 per ton, up $7.46 from the previous trading day on a FOB Singapore basis. The European MTBE market closed at $846.49-$846.99 per ton, down $26 per ton from the previous trading day on a FOB ARA basis. The U.S. MTBE market closed at $769.91-$770.26 per ton, down $9.99 per ton from the previous trading day on a FOB Gulf offshore basis (217.39-217.49 cents/gallon).

Future Market Forecast: Currently, raw material prices remain high, and local inspections remain strict, suppressing demand. MTBE analysts believe that the Chinese MTBE market will mainly show weak consolidation.