MTBE Market Prices Narrowly Decline

May 29th News

According to the commodity market analysis system, from May 25 to 29, the price of MTBE first rose and then fell from 6,425 CNY/ton to 6,237 CNY/ton. The price decreased by 2.92% during the period, with a maximum fluctuation of 4.77%. It fell by 1.38% compared to the previous period and increased by 22.30% year-over-year. Due to the high operation of international crude oil prices and the rise in gasoline market, the market sentiment was strong, and prices showed an upward trend. As prices reached a high level, the willingness to take delivery decreased, coupled with the decline in international crude oil prices and the gradual weakening of gasoline demand, the MTBE market entered a channel of fluctuating downward.

MTBE China production price average trend chart:

Cost Perspective: Regarding crude oil, international oil prices have declined. The primary negative factors include: market optimism about a potential peace agreement between the U.S. and Iran and the expected opening of the Strait of Hormuz, which has eased geopolitical tensions and reduced concerns over supply risks. As of May 28, the July contract for Brent crude oil futures closed lower, with the settlement price at $93.71 per barrel.

Demand Side: On the downstream side, international crude oil futures have been weak and declining, and the refined oil market as a whole has shown a subdued performance. Refineries are mostly focused on selling off inventory at low prices to boost volume. However, terminal demand varies significantly, resulting in stronger demand for gasoline and weaker demand for diesel among local refineries. Traders in the intermediate links are adopting a conservative approach by locking in prices and placing orders cautiously, while downstream businesses are stocking up at low levels and engaging in cautious buying and selling. Overall, trading activity in the market remains tepid. The demand side for MTBE is being weighed down by bearish factors.

Supply side: Huayi Chemical's facility has resumed operations, but the shutdowns of Zhonghao Jian, Dongying Shenchí, and Dongfang Hongye have affected production, leading to a decline in the overall facility utilization rate. The MTBE supply situation is positively influenced by these factors.

As of May 29, statistics on MTBE factory prices from selected production enterprises:

As of the close on May 28, the Asian MTBE market closed at a price that was $52.78 per ton lower than the previous trading day, with FOB Singapore at $780.3–$782.3 per ton. The European MTBE market closed at a price that was $1.75 per ton higher than the previous trading day, with FOB ARA at $1,033.24–$1,033.74 per ton. The U.S. MTBE market closed at a price that was $16.96 per ton higher than the previous trading day, with FOB Gulf offshore prices at $1,111.50–$1,111.86 per ton (313.84–313.94 cents per gallon).

Market Outlook: Raw material prices remain at high levels, with prices of various feedstock gases staying relatively high, meaning cost pressures persist. As a result, retail price caps for refined oil products are expected to be significantly lowered this round, thus creating negative market sentiment for the regional oil market. Refineries are shifting their marketing strategies toward increasing shipments, making it highly probable that prices will experience volatile declines. MTBE analysts believe that the MTBE market will likely enter a period of consolidation.