Oil prices plummeted! Dachang stopped production! This raw material has fallen by a month's increase in 10 days!

International oil prices plummeted

International oil prices have dropped significantly. As of the close of the day, the main WTI crude oil futures contract closed at US$80.86/barrel, a decrease of 3.63%; the main contract of Brent crude oil futures closed at US$81.99/barrel, a decrease of 3.22%.

In the stock market, Exxon Mobil fell 1.37%, Chevron fell 0.7%, ConocoPhillips fell 0.42%, Schlumberger fell 0.69%, and Occidental Petroleum fell 1.48%.

The higher-than-expected increase in crude oil inventories is an important factor in the pressure on oil prices.

Last night, the US Energy Information Administration (EIA) released data showing that although US gasoline inventories fell to the lowest level since November 2017, crude oil inventories unexpectedly increased by 3.29 million barrels last week, and crude oil production was higher than expected for six consecutive weeks.

In addition, the OPEC+ Joint Ministerial Supervisory Committee meeting will be held at 21:00 Beijing time tonight, and the ministerial meeting will be held thereafter. Prior to this, President Biden spoke daily to OPEC+. According to Bloomberg News, on the eve of OPEC+ meeting on Thursday to discuss oil policy, Biden continued to pressure it to fight high oil prices and blamed its oil policy for inflationary pressures.

In addition to the increase in crude oil inventories, the news that Iran announced that the Iranian nuclear talks will be officially opened also plunged oil prices.

According to Xinhua News Agency, Iranian Deputy Foreign Minister Bagheri announced on the 3rd that the Iranian nuclear talks will resume on November 29 in Vienna, the capital of Austria.

The United States is currently suffering from high energy prices, and the resumption of Iran’s nuclear negotiations is likely to ease the United States’ sanctions on Iran, leading to the return of Iran’s crude oil production. This expected warming also reduces the possibility of additional OPEC+ production increases.

But Bart Melek, head of commodity strategy at TD Securities, said that the answer is difficult to determine whether OPEC will increase production just because the United States is politically uneasy about gasoline prices.

Shell factory fire, production capacity of one million tons stopped

According to foreign media reports, the Singapore-based petrochemical producer Shell (Shell) had a fire in its cracking furnace in Pulau Bukom on November 1 due to technical problems. It is reported that the company has notified some ethylene and The supply of propylene buyers has decreased. Some market participants said that the cracking device is currently offline and will be maintained for a week.

According to statistics, the capacity of this cracker is 1 million tons/year of ethylene and 500,000 tons/year of propylene. In addition, the production of the cracking unit is mainly used in its derivative plants, including a 250,000 tons/year propylene oxide unit or 550,000 tons/year styrene unit, and a 70,000 tons/year restarted in May 2020. Isopropanol plant and 750,000 tons/year ethylene glycol plant.

▶ Its main downstream supply of ethylene includes the 350,000-ton/year vinyl acetate plant of Dalian Chemical in Taiwan, China and the metallocene hexene LLDPE plant of Singapore Prime Evolue on Jurong Island.

▶ Its propylene production mainly supplies Changchun Chemical's 194,000-ton/year cumene plant and Mitsui Phenol’s 151,000-ton/year cumene plant.

▶ In addition, the comprehensive facility here also has an 18.6 ton/year butadiene extraction unit, but its contractor has not received any notice of supply reduction so far.

In addition, PetroChina Shell’s first cracking unit in Guangdong has recently undergone maintenance. According to sources, this maintenance is temporarily unable to determine the exact date and duration of the closure. The ethylene production capacity of the cracker is 1 million tons/year, and the propylene production capacity is 535,000 tons/year.

Soaring 200%! Fall back to half in half a month!

Unexpectedly, PVC, a mediocre raw material, can become a hot "raw material star" in 2021.

After entering the second half of the year, PVC has skyrocketed! Created a new high point in history! PVC has risen from more than 7000 to about 15000! The speculation in the market is even higher, with an increase of more than 2 times! It can be said to be hard to find!

Behind the skyrocketing price is the imbalance of global supply and demand structure. The global epidemic has repeatedly brought blockades in some regions and rapid recovery of demand after the epidemic in some regions. It has also brought about the problem of port and shipping congestion, which has caused global shipping prices to continue to skyrocket; climate change has also triggered the United States since August 2020. Due to the force majeure of production enterprises caused by a series of natural disasters, such as the cold wave in the United States in February 2021 and the flood in the United States in July, the export volume of these enterprises was suddenly tight, which in turn drove China's PVC export opportunities.

Superimposing the “dual energy consumption control”, “carbon neutrality and carbon peaking”, and tight power supply under the new form of China’s environmental protection will have a huge impact on the raw material supply of PVC production enterprises based on calcium carbide method, and the production cost of PVC calcium carbide method is higher than that of 2020. The annual increase exceeds 60%.

However, entering the end of October, as the state's intervention in the coal market continued, the cost of the coal chemical industry was controlled. In addition to the weakening of the previous market expectations, the price fell sharply and basically fell to the price before the Mid-Autumn Festival, and the price was generally between 9,000-10,000. As of November 4, the quotations of PVC manufacturers continued to fall!

▶ Inner Mongolia Sanlian Chemical's 400,000-ton/year PVC plant starts near 60%, and the daily output is around 700 tons. The factory area is currently under a single negotiation. The benchmark price of Type 5 powder is accepted by North China at 9,150 CNY/ton;

▶ The 120,000 tons/year PVC plant of Gansu Yinguang Chemical Industry Co., Ltd. has a full production capacity, with a daily output of 400 tons. The new price of the enterprise is lowered, and the 5 type powder is quoted at 9,300 CNY/ton to the acceptance plant, and the contract is negotiated;

▶ Heilongjiang Haohua's 250,000-ton/year PVC plant has started about 50%. The company's quotation is lowered by 300 CNY/ton, the ex-factory quotation of the five-type material is 9500 CNY/ton acceptance, the cash exchange rate is lower than 50 CNY/ton, and the export price is lower than 50 CNY/ton. The actual transaction is negotiated;

▶ Henan Lianchuang’s 400,000-ton PVC plant started 40%, the 5 type reported 9,500 CNY/ton ex-factory cash, and the 3 type reported 9,700 CNY/ton. The actual order negotiation is mainly;
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In just ten days, the mainstream average price in the market plummeted by 5200! More than 10 days have fallen by a month's increase! Many product manufacturers said that "online waits for the price of PVC to fall back to 7000"!