Asphalt spot market after a wave of decline after the current to maintain consolidation. The current downstream road project has not been focused on the start, the demand is still limited, mostly in the main inventory consumption, traders buying enthusiasm is not high, refinery inventory growth, mostly price sales. The market need to pay attention to whether the demand in late May after the start, from the disk point of view, backed by 2400 yuan / ton support, 1709 contracts have long opportunities to do more.

Inventory slightly higher

Since the beginning of the year, the asphalt refinery operating rate as a whole is low, the first quarter operating rate of only about 50%, at historically low; but since April, the refinery started to pick up, especially in mid-April operating rate rose to 60% ; But in early May fell again to about 50%. Data show that as of May 3 the week, the major domestic asphalt refinery operating rate of 56%. Among them, the South China, Southwest and Northwest region operating rates are about 70%, which is better with the needs of the western region is directly related to the Northeast and the operating rate of about 60%; Yangtze River Delta and Shandong operating rates are about 50%. Overall, the recent domestic asphalt refinery started short-term recovery, but the overall is still not high, is expected in late May after the demand improved, the refinery start level is expected to further rise.

On the other hand, the refinery started to pick up but the demand did not follow up, traders demand for procurement decline, resulting in refinery inventories began to increase from the beginning of April, as of May 3 week, refinery stocks increased to 34% Regional stocks increased to about 40%, northeast, Shandong and the Yangtze River Delta region increased to about 35% of the stock, Northwest stocks increased to about 25%.

Asphalt refinery profits rise

This year, as oil prices fell and asphalt prices rose, asphalt and crude oil prices are also rising, which means that the refinery profits compared with 2016 is also improved. According to the statistics of the river, the first quarter asphalt refinery profitability, theoretical profits continue to improve, to the beginning of May theoretical profit reached 392 yuan / ton, the overall higher than last year’s profit level. But we believe that the late refinery profits difficult to have greater room for growth, because the third quarter crude oil trend is expected to be strong, and the asphalt is difficult to have a larger upside, so the refinery profits are expected to increase is limited.

Demand in the western region is bright

In the near future, infrastructure projects in the western region have been started to reduce the demand for asphalt terminals. The demand for asphalt in the western region has continued to rise. The refinery inventory in the northwest and southwest regions has been lower, traders and owners have increased demand for high quality asphalt. But the demand for other regions is still relatively limited, the lower road construction projects started less, traders increased inventories, refinery shipping pressure. In addition, South China and Southwest and other places affected by rainfall, the project construction is difficult to effectively carry out, to suppress the market will. In the case of poor overall market demand situation, the refinery may still increase the recent efforts to promote the shipments, but the overall price range is expected to not be too much. In the future, we expect the overall market demand in May to be improved in April, with particular attention to whether there will be substantial changes in asphalt demand since mid to late May.

March imports of asphalt has increased

Since late March, imports of asphalt prices have changed the previous situation, South Korea and Singapore imported asphalt are down. Singapore asphalt May cargo two major brand prices are down, CIF fell 17.5 yuan / ton to 345-360 yuan / ton, the dutiable value of 2800-2950 yuan / ton. South Korea asphalt cargo prices in May there are different rates of decline, the East China CIF fell to 295-320 US dollars / ton, dutiable value in the 2550-2700 yuan / ton, low prices and parts of East China asphalt prices basically flat. In March, domestic imports of asphalt increased over the previous two months, imports in March more than 400,000 tons, much higher than the import level in January and February.

China’s urea is facing increased production, domestic agriculture (pay attention: just agriculture) to reduce demand and exports to reduce the three major negative factors, there are other negative factors? If not, the above has been analyzed before the two factors, Of the analysis to be a simple review: First, the decline in corn planting area brought about by the largest reduction in the amount of urea will not exceed 1.5 million tons; Second, the export will not significantly decline in the case, even if the urea operating rate returned to 70% , It is also difficult to ensure that the supply of domestic summer. Analyze the last question today: late exit.

I do not do international trade, so the discussion of this issue a little bit of the ax, but several phenomena worthy of attention: First, the United States and India, a substantial reduction in urea imports; Second, India’s first round of bidding this year, only to recruit 260,000 tons; After the end of a round of bidding, immediately announced a new round of bidding; Fourth, the international market more than a big reversal of the vacancy.

From the US Department of Agriculture published planting intention report, the United States this year will face the adjustment of planting structure: corn, wheat and rice area decreased, while the cotton and soybean area increased, the overall acreage changed little. US agriculture is highly marketed and the statistics are more credible, so use this report to predict global demand changes, believing that readers will not have much objection. In this report, the author explained the following: First, China’s past storage and storage of agricultural products are the lowest in the current global price, in addition to the price of agricultural products is not bad; Second, although the domestic prices are talking about agricultural prices caused by fertilizer demand But the global acreage will not be significantly reduced this year; third is in the relatively high degree of market-oriented countries, in addition to increasing the soybean and cotton Area, the sugar planted area will increase significantly, which may be Brazil’s urea imports increased over the same period last year, the reasons for the increase.

So why is the US imports of urea significantly reduced? I believe that there may be three reasons: the increase in production, demand reduction and panic a little delay. The author lacks specific data, but it is certain that the new production is 100,000 tons, the demand is reduced by one hundred thousand tons, while the import reduction is one million tons, so the gap can only be delayed by the price to delay the procurement to explain. Time has arrived in April, rigid demand is about to release, taking into account the shipping period, procurement time is running out. In fact, last week the US market has shown signs of bottoming up, but a slap in the face, another look at another big importer – India.

Some people say that India’s high inventory, ask, high library in the first round of the tender just after the end of the second round of bidding will be held? Some people say that last year, India’s urea sales fell by nearly 3 million tons, which is equivalent to India’s annual sales 10%, due to agricultural prices caused by the decline in planting area so much? Reference to the US Department of Agriculture report analysis, the demand is significantly less likely to reduce; is the cause of the weather is unlikely, so I suggest a larger May be less than when farmers do not buy fat, so it seems high circulation channels. If this is the case, once India’s demand erupted, not only to make up for the pre-import gap, but also to meet the normal year of the purchase, which will create India’s history, the largest amount of urea procurement year, I even optimistic to believe that India Procurement can support the global market in the first half of the degree! India can not wait to tender, may mean that India officially opened to buy buy buy model!

Unfortunately, the international market after the Spring Festival more than empty, the trend seems to be the same as the above analysis of the author, and the domestic port has become a popular market concern, how to understand these two issues, because of space reasons, the next chapter to do analysis.

Summary: the international market has been overdraft bad, rigid demand is coming, the improvement of urea exports worth looking forward to!

Russian media said Wang Dongjin, vice president of China National Petroleum Corporation (CNPC), said at the press conference held by the Information Office of the State Council of the People’s Republic of China that China has gradually built in Central Asia, China, Russia, China, Myanmar and the sea 4 large oil and gas transport channel, the initial formation of China Unicom’s oil and gas supply and market network.

According to the Russian satellite news agency Beijing May 8 reported that Wang Dongjin said that China Petroleum is the main business of oil and gas exploration and development, refining and chemical engineering, engineering and technical services, international trade, equipment manufacturing, is a trans-regional, cross-sectoral, transnational business International Energy Company. In 2016, ranked third in the world’s wealth of five hundred.

He pointed out that since the introduction of the “One Way” initiative, PetroChina upholds the principle of co-building, building and sharing, deepening oil and gas cooperation, promoting interconnection and making a series of new developments.

Wang Dongjin said that China’s oil and “along the way” along the 19 countries to 50 projects to promote the relevant countries of the oil and gas supply and economic and social development. At the same time, actively promote the construction of infrastructure, from the northwest, northeast, southwest and east gradually built in Central Asia, China, Russia, China and Myanmar and the sea and other four major oil and gas transport channel, initially formed Unicom Chinese and foreign, through multi-national oil and gas supply and market The internet.

He also pointed out that China Petroleum in the “one way” oil and gas cooperation, give full consideration to the resources of the government, partners, local communities, reasonable concern, and strive to build a win-win situation, win-win fate of the community. For example, in Kazakhstan, China Petroleum Holdings’s Acked Binbin company, tax accounted for 70% of local tax revenue, providing more than 30,000 jobs. At the same time, in order to ensure that the local people in the cold winter can eat fresh vegetables, the company also invested in the construction of Kazakhstan’s largest modern greenhouse vegetable greenhouses.

According to the news network – the reporter learned that Wang Dongjin stressed that the dedication of energy, to create harmony, is the purpose of China Petroleum, this harmony, including oil and gas production and environmental harmony, including China Petroleum and Resources countries partners and local community harmony. China National Petroleum will always uphold this purpose, in the “all the way” oil and gas cooperation to do responsible companies, do outstanding corporate citizenship.

It is reported that China Petroleum in promoting employment, enthusiastic public welfare, improve people’s livelihood, environmental protection and other aspects of the active implementation of social responsibility, promote popular contacts. The investment and development of public welfare undertakings cover almost all projects in the country where the number of direct beneficiaries is more than 2 million. Wang Dongjin introduction, in donations, the company in Kazakhstan has funded nearly a thousand outstanding students to study in China. In Myanmar, China Petroleum Infrastructure Assistance Project 177, the new reconstruction of 72 schools, 30 hospitals and power facilities, roads and bridges, water supply facilities.

Ministry of Environmental Protection on the Beijing-Tianjin-Hebei and the surrounding areas “2 +26″ city of air pollution control supervision has been carried out for 1 month. As of May 7, 28 inspectors were surveyed 8447 enterprises (units), found that 5594 enterprises have environmental problems, accounting for about 66.2% of the total inspection.

There are problems in the enterprise, “scattered pollution” problem of 1930 enterprises, exceeding the emissions of 30, not installed pollution control facilities 512, sewage treatment facilities are not running 507, suspected of online monitoring fraud 12, there are VOCs Governance of 179, anti-dust measures are not perfect 1075, there are 1349 other problems.

The inspection team will inspect the environmental problems discovered every day to report to the Ministry of Environmental Protection, at the same time copy the city where the people’s government. Ministry of Environmental Protection on the inspection found in the outstanding environmental problems, issued a notice of supervision, instructed Beijing, Tianjin, Hebei, Shanxi, Shandong, Henan and other six provinces, municipal environmental protection bureau (bureau) to rectify the issue of supervision.

May 5, the Ministry of Environmental Protection issued a third batch of large inspectors found that the supervision of the notice, the total supervision of 738 outstanding environmental issues. Supervision of the environmental issues, involving “scattered pollution” illegal production of enterprises 411, other prominent environmental problems 327.

Prior to this, the Ministry of Environmental Protection has issued two batches of inspectors found that the issue of supervision notice. The second batch of 554 environmental problems. According to the feedback, as of May 2, the second batch of supervision of 255 “scattered pollution” illegal production enterprises, the removal of 115 banned, ordered to stop 106, the completion rate of 86.7%. The second batch of 299 other outstanding environmental issues, has ordered to stop 107, 68 cases of punishment, demolition of 16 banned, 146 have been rectified to complete the completion rate of 48.8%, the remaining issues are being rectified.

This year, in the cut, geopolitical risk rise in the pattern, oil prices continued to shock rise. However, starting from last Thursday, oil prices “flash”, WTI was below $ 44 / barrel, recently as high as $ 55 / barrel.

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Libya and Canada crude oil production increased, Russia with the ambiguous attitude of the market to worry about. “Since mid-April, oil prices rebounded and suddenly turned down, down more than 15%. Fundamental itself has no significant deterioration of the change.” East futures futures crude oil analyst Jin Xiao told the first financial reporter.

In his view, OPEC semi-annual meeting held soon (May 25), oil prices fell to force the Member States to abandon differences and reach a decision to extend production. OPEC production lasted more than 4 months, but the effect is very limited. Even if the cut, oil prices are difficult to rise sharply. The realization of rebalancing needs to be achieved in a lower oil price environment, so the oil price outlook is not optimistic, WTI is expected to level down to 45 US dollars / barrel near the increase in the number of rigs and OPEC can withstand the lower price to find New balance.

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As of May 7, Beijing time before the press release, oil prices rebounded, Brent oil price reported $ 49.43 / barrel, WTI oil price reported $ 46.51 / barrel. But the two are far from the recent 58 US dollars / barrel and 55 US dollars / barrel high still far away.

Oil price accident “flash collapse”

On Thursday, oil prices plunged 5%. Russian government spokesman Dmitry Peskov (Dmitry Peskov) said it has not yet decided whether to extend the crude oil production agreement is the day of oil prices fell “culprit.”

Russian Ministry of Energy issued a statement saying that the country has been in October last year on the basis of production to achieve reduction of 30.079 million barrels / day, exceeding the task of reducing production. According to previously agreed agreement, Russia needs to cut production in the first half of this year to 10,947,000 barrels / day. Russian Energy Minister Alexander Novak pointed out that he would hold talks with senior domestic crude oil companies to discuss the extension of the cut-off agreement, but he declined to make a statement on whether to support the extension of the cut-off agreement.

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Worse, the world’s largest off-shore crude oil broker PVM said that Libya, Nigeria’s oil production or has begun to rise, leading to US oil, cloth oil again dropping. Cinda Futures said that Libya and Nigeria can be said that the oil market of the universal card. The two OPEC oil-producing countries have been exempted from production last month’s fuel production of 205 million barrels / day. Compared with October last year dropped more than 10 million barrels / day, but this situation or reversed this month. Two days, the two oil producers have announced production rose to 76 million barrels / day (Libya) and 200 million barrels / day (Nigeria), the two countries will further increase the production of global oil market damage.

Nevertheless, Jin told reporters that the May 25 OPEC semi-annual meeting, to achieve a greater probability of prolonged production. However, even so, oil prices on the action can be very limited, the fundamental reason is that production did not lead to a significant return to the level of inventory. If OPEC failed to reach agreement on the reduction, oil prices will face a greater downside risk. From the point of view of the oil ministers of the major member states, the vast majority of countries support the extension of the cut-off agreement, on the one hand because the policy does not continue to pay the cost is too high, on the other hand is the actual output process is not large, Maintaining the status quo is the best choice for each country.

Shale oil wells are rapidly recovering

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Regardless of how the attitude of OPEC changes, it can ultimately determine the “bottom” of oil prices, the real decision is “top” is still the US shale oil.

The Energy Information Administration (EIA) announced that US crude oil production rose to 92.93 million barrels per day for the week of April 28, up from 9.265 million barrels per day in the previous week. And last week’s data show that the number of active oil drilling platforms in the United States rose for 15 weeks, another two-year high. This means that US oil producers to speed up the resumption of production, US crude oil inventories and production continued to rise on the international oil prices will continue to impose downward pressure.

In general, shale oil production costs are higher than OPEC. East China Futures Research Institute analysis said that the second quarter of 2015, the rebound in oil prices on the number of drill is not very obvious, the number of rigs only rebound in February will return to the downward trend. But since May 2016, the number of rigs has risen all the way. As of the end of April 2017, the number of rigs has exceeded the bottom of 2016 more than doubled, indicating that shale oil companies to reduce the efficiency of the results has been very prominent, that is, WTI average of 50 US dollars / barrel, the enterprise will not stop New investment.

In addition, Jin Xiao also told reporters that after the 2014-2016 low oil prices eliminated, the survival of the shale oil business has a strong competitive edge. Oil prices need to find a new balance between the increase in the number of rigs and OPEC can bear the price between the lower limit. If the oil price of the rig is less than the lower price limit that OPEC can afford, then the price war can only be restored.

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The economic cycle peaked to suppress the goods

In addition to the supply side, the strength of oil prices and demand side is not unrelated.

The United States is still the world’s largest oil demand in the country, accounting for about 25% of the total global demand, but the proportion has been slightly lower; China is the world’s first, the United States is the world’s largest oil demand, The two major oil consuming countries, 2016 oil demand in the global proportion of more than 12%; India as an important emerging global economy, in recent years, rapid economic growth led to rapid growth in oil demand, oil demand in 2016 year-on-year growth rate of 7.3 %, But India’s total oil demand is small, only about 35% of China, so the growth is not large.

In April, the General Administration of Customs data show that China’s imports of crude oil from January to March 105 million tons, an increase of 15%. At this point, a quarter of China’s imports of crude oil 855 million barrels / day, beyond the United States to become the world’s largest market. In the first quarter of last year, the international market commodity prices in the low, and then continued to rebound, subject to commodity prices rose sharply year on year, a quarter of China’s overall import prices rose 13.5%, of which iron ore imports average price rose 80.5%, crude oil rose 64.7%.

However, the recent cyclical expectations of China and some Asian countries are strong, which also hit the market sentiment. China’s iron ore, rebar, coke futures fell sharply. China’s April manufacturing industry PMI fell to its lowest level in seven months, after China’s official manufacturing and service industry PMI fell 0.6% and 1.6% in March, respectively, showing services and manufacturing Both the slowdown in output growth, Monita Zhongzheng Health said the inflection point seems to have emerged.

In addition to the above negative factors, the future of the political properties of crude oil can continue to support oil prices?

“The current pattern of loose oil supply and demand reduces the market for supply disruption concerns, resulting in oil prices on the geopolitical sensitivity significantly reduced.” Guan Qingyou said that since 2014, there have been many global geopolitical events, such as the Ukrainian crisis, the Islamic countries (IS) rise triggered by the war in Iraq, Saudi troops sent to Yemen, Turkey shot down Russian fighters, the Turkish military coup, the British exit the EU, etc., have no significant impact on oil price fluctuations.

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