Refined oil prices remain high

On March 17, the National Development and Reform Commission raised the price of refined oil
.

Supply is stable, medium and small decline

Affected by the continuous record high of crude oil, the price of domestic refined oil rose for the fifth time this year recently, and the refined oil market continued to soar
.

In order to maintain the stability of the domestic refined oil market, in mid-March, the National Development and Reform Commission instructed that domestic refineries should maintain stable production to avoid a large amount of load reduction due to the high cost of imported crude oil; domestic export companies must first ensure domestic demand and control the centralized export of refined oil
.

As of the end of mid-March, refinery gasoline and diesel output showed a slight decline, of which gasoline decreased by 13,500 tons month-on-month, and diesel decreased by 20,600 tons month-on-month
.

Looking at exports, data from the General Administration of Customs shows that in January, China's refined oil exports were 1.
64 million tons, down 12% month-on-month and 59% year-on-year; in February, China's refined oil exports were 1.
89 million tons, up 15% month-on-month.
, down 51% year-on-year; only 24% of the export quota was completed from January to February
.

　　"In April, the main refineries entered the maintenance stage one after another, and the operating rate may continue to decline.
The reduction in resource supply will benefit the refined oil market
.

　　Cost support remains

　　Affected by the geopolitical situation, the characteristics of international oil prices that are easy to rise and hard to fall have continued, and once rose to the highest price since July 22, 2008
.

　　After the escalation of the conflict between Russia and Ukraine, the sanctions imposed by Western countries on Russia have been increasing
.

　　To make matters worse, Yemen's Houthi rebels' recent strike on Saudi Arabia's energy facilities has also increased the pressure on the stable supply of crude oil
.

　　According to OPEC report estimates, OPEC crude oil production in February was 28.
47 million barrels per day, still below the average of the past five years
.

　　Meng Peng, an analyst at Zhuochuang Information, believes that the focus of the international community is still on the military conflict between Russia and Ukraine and the sanctions imposed by the United States and other countries on Russia.
At present, it is difficult to determine whether the sanctions will be short-term or long-term.
Therefore, concerns about supply risks are still ongoing.

.

　　Demand picks up moderately

　　"As the weather warms up, engineering infrastructure and other industries will resume normal production, and with the advent of spring ploughing, the demand for refined oil is expected to continue to strengthen
.
" Jinlianchuang analyst Lu Qiaohui said
.

　　Since the beginning of the year, due to factors such as the Winter Olympics and extreme weather, the terminal demand for refined oil products has been delayed
.
Especially in March, affected by the spread of the epidemic, the travel rate of residents in Jilin, Shandong and other places decreased, and the start of industrial mining and infrastructure construction was restricted.
In addition, there were no good holidays in the near future, which further suppressed gasoline demand
.

　　Not only that, the prices of gasoline and diesel have been pushed up to high levels across the board, limiting the increase in terminal demand
.
Although the current gasoline and diesel prices have loosened, firm transactions have increased room for negotiation
.
However, mid- and downstream users mainly purchase on demand, the market has a strong risk aversion, and the overall buying and selling atmosphere is general
.

　　"With the continuous strengthening of epidemic control measures, some cities in Zhejiang and Shandong have achieved a dynamic reset of the community, and the epidemic situation has continued to improve.
Infrastructure, logistics and public travel restrictions will be loosened.
In addition, the continuous deepening of spring ploughing from south to north will drive gasoline and diesel fuel.
Demand has increased moderately
.
In addition, entering March, foreign gasoline and diesel market prices are high, and for domestic export companies, export arbitrage is considerable, and it will also support the domestic refined oil market
.
” Lu Qiaohui analyzed
.

　　It is reported that the price adjustment window of refined oil products will be opened again on March 31, and the previous expectation of price reduction may reverse as the international oil price exceeds US$120/barrel again on March 24
.
If the price of refined oil rises, it will be good for the production enterprises again
.
However, the first quarter is coming to an end, and the sales progress of each refinery is different.
In order to catch up with sales, some companies do not rule out the possibility of price reductions
.
However, supported by fundamentals, it is unlikely that the refined oil market will plummet
.