Saudi Arabia’s Amy Company unveiled its first profit data since nationalization nearly 40 years ago Monday, unveiling the mystery of its large oil fields, according to World Oil in London. The company’s bond prospectus shows that Ghawar’s daily capacity cap is 3.8 million barrels, far below the market consensus of more than 5 million barrels a day.

The U.S. Energy Information Agency is a government agency that is often used as a benchmark in the oil market to provide statistical information. In 2004, Saudi Arabia and the United States said in a Washington report that the oil field produced more than 5 million barrels a day and has been doing so for at least the past 10 years.

Ghawar’s new maximum production means that during the Permian period, according to government data, the country produced 4.1 million barrels a day last month, making it the world’s largest oil basin. This correlation is not accurate, that is, Saudi oil field is a conventional reservoir, while Permian is an unconventional shale formation, but it shows the change of market power balance.

Safaniyah Oilfield, founded in 1951, is still the largest offshore oil field in the world with a daily production capacity of 1.3 million barrels. Saudi Arabia and the United States operate a total of 101 oil fields.

Saudi Arabia and the United States have a maximum capacity of 12 million barrels per day, as Riyadh has said for many years. The so-called “neutral zone” that Saudi Arabia shares with Kuwait can also produce 500,000 barrels a day.

Although the prospectus confirms the total maximum productivity, the distribution of productivity among oilfields is different from the market’s previous expectations. As a policy, Saudi Arabia maintains its daily oil production at about 1 million barrels to 2 million barrels, only during wars, supply disruptions in other areas or exceptionally strong demand.

Saudi Ami also disclosed reserves in the top five oilfields, showing that some of them have shorter life expectancy than previously expected. Taking Ghawar as an example, its remaining oil reserves are 482,000 barrels, which will last for 34 years in terms of maximum production. Nevertheless, over time, enterprises can often increase reserves by deploying new technologies or technologies.

Saudi oil reserves are enough to sustain production for another 52 years, with a maximum capacity of 12 million barrels per day.

The Negative tunnel gradually dissipated

In recent years, the domestic methanol market is still strong in Northwest China and weak in East China under high inventory pressure. Among them, the sales price of methanol in Northwest China ranges from 2120 to 2250 yuan/ton. Reporters learned that the price of methanol in Northwest China is strong due to the maintenance of several inland methanol plants. However, the methanol inventory in East China is relatively high, and the price of methanol has declined. At present, the spot quotation is 2430-2500 yuan/ton.

With the overall methanol oscillation downward in the last two weeks, market sentiment has also weakened. According to Hu Xin, a futures analyst in Yide, the performance of the current market is actually expected. On the one hand, the impact of the reduction brought about by the previous market expectations of domestic and foreign equipment maintenance did not appear in March. On the contrary, large-scale plants such as Zhonghao, Boyuan and Datang were restarted one after another. The methanol start-up rate remained high and reached a new high at the end of March. Coastal stocks also reached a new high in mid-month. On the other hand, the reduction of VAT reduces the cost of goods in the later period, which has a negative impact on futures contracts after April. In addition, the joint effect of formaldehyde shutdown in northern Jiangsu and southern Shandong and the sharp drop of ethylene glycol on methanol caused by the safety inspection of dangerous chemicals is also an important reason for the recent weakening of methanol.

For the current methanol price, many market participants said that they had basically reflected the “poor expectations”. “Expectation difference” refers to the contrast between the anticipation of reduction in spring inspection and the reality of high innovation in construction. “Methanol prices have fallen for more than two weeks and valuations have fallen to a low level.” Hu Xin said.

It is understood that in the second quarter of each year, the methanol plant in the north, especially in the northwest, will be routinely overhauled. The spring inspection will result in a decrease in the start-up load of the methanol plant in the second quarter. “At present, the profit of coal-to-methanol in Northwest China is good, with an average profit of about 600 yuan/ton. In addition, the price of methanol has stopped falling and stabilized at present, enterprises may postpone overhaul.” Huang Liqiang, director of Jinshi Futures Investment Consulting Department, explained.

It is noteworthy that the recent rise in international oil prices, OPEC + production restriction effect is obvious, crude oil prices in the first half of the year basically did not expect a substantial decline. In this context, the cost support of petrochemical products has been strengthened, most of the product prices have rebounded, and some of the product prices have increased significantly. Affected by this, the recent methanol market sentiment has gradually returned to rationality.

“For the methanol market, the supply reduction caused by the overhaul of foreign units is large, and the import of olefin units in the port area is expected to decrease significantly in April. In order to meet the normal demand, some of the olefin units in the port area began to increase the intensity of inland procurement.” Yu Qiansen, a gold futures analyst, believes that the impact of safety inspections on the methanol market will basically dissipate in the middle of this month, and that the benefits of spring overhaul and a sharp reduction in imports are gradually being realized. “If methanol stocks in coastal areas fall sharply this month, it is reasonable for the market to strengthen again.” In his view, according to the current market development and expectations, there is no basis for a sharp decline in methanol prices, which will gradually strengthen in the later period.

At present, the value-added tax has settled down, the futures and cash arbitrage has begun to leave the market gradually, and the market is showing signs of stopping the decline. In the past two weeks, coastal stocks have begun to decline slightly. Imports are expected to decline in April. Mainland maintenance will also be gradually realized. Later fundamentals may turn better. But in Hu Xin’s view, it is still too early to say that the market reversal, data still need to see the decline in methanol start-up rate and continued inventory depletion.

As the methanol-to-olefin plant in Nanjing is being completed and ready for commissioning, cargo in the port area is expected to decrease rapidly, but whether the follow-up foreign plants can meet the increment is unclear. “It is understood that the Iranian device is not stable and is currently under maintenance. Because of the sanctions imposed by the United States on Iran, the actual supply of Iranian goods is not normal. Whether the supply can be stabilized or not is unknown. If the supply cannot be stabilized, there will even be a shortage of supply and demand in the port area. Yu told Futures Daily.

“In terms of demand, we should pay attention to the recovery after formaldehyde security inspection and the start-up process of new MTO production in Jiutai, Luxi, Chengzhi and Baofeng. In addition, we also need to pay attention to the linkage effect of price changes of ethylene glycol, ethylene and other chemical products on methanol. Hu Xin said that at present, the demand for coal-based olefins accounts for more than half of the total demand for methanol, and the demand for coal-based olefins is crucial to the demand for methanol.

With the continuous improvement of LNG production capacity, the global LNG trade scale will continue to expand, and it is expected to exceed 50 billion cubic meters by 2023, an increase of about 30% over 2017.

On April 2, at the 19th International Liquefied Natural Gas Conference (LNG2019), known as the “Olympic Games” of the LNG industry, Yang Hua, chairman of China Ocean Petroleum Group Co., Ltd., made the above judgment in an interview with reporters of the Economic Reference Daily.

He disclosed that, as the third largest LNG importer in the world, CNOOC will actively promote technological innovation, management innovation and business model innovation in the future, continue to vigorously develop natural gas business, establish a stable supply of LNG resources, and promote the construction of LNG receiving stations. It is expected that the proportion of natural gas will reach 50% by 2030, and LNG receiving stations will reach 15-17, with annual receiving and processing capacity exceeding 80 million tons. Let more users use more economical LNG products. At the same time, we will promote the opening and sharing of LNG receiving stations in an orderly manner, so as to make more enterprises and entities participate in all aspects of LNG industry chain with a more active and open mind, vigorously promote LNG heavy truck and ship filling business, and actively promote its application in the field of transportation.

In today’s world, the trend of clean and low-carbon energy development is becoming more and more obvious. The energy transformation process characterized by high efficiency, cleanliness, diversification and intelligence is accelerating.

In Yang Hua’s view, natural gas, as an efficient, low-carbon and clean fossil energy, has begun to replace primary energy sources such as coal and petroleum in many energy-using fields. It is an important bridge to transition to new energy system and a realistic choice to promote energy transformation. By the end of 2017, the recoverable reserves of natural gas in the world were 193.5 trillion cubic meters and the recoverable life was 52.6 years. The long-term growth trend of natural gas resources supply is promising, which can guarantee the sustainable development of natural gas industry.

Among them, LNG has gradually become the most active form of natural gas supply with the advantages of easy transportation, multi-subject, flexibility, safety and efficiency. Data show that China’s LNG imports accounted for 44% of global LNG trade growth in 2017 and nearly 60% in 2018.

As early as the mid-1990s, China National Offshore Oil (CNOOC) took the lead in introducing LNG into the southeastern coast in line with the national energy strategy. At present, 10 LNG receiving stations have been built, ranking first in China, with an annual receiving and processing capacity of more than 45 million tons. In 2018, China offshore oil imported 26.42 million tons of LNG, with a total import volume of 150 million tons, accounting for more than 65% of the total import volume in the country.

In addition, CNOOC has established three core independent technology systems, namely, natural gas liquefaction technology, LNG receiving and storage technology and clean energy comprehensive utilization, through independent research and development and mastery of the core technology of LNG industry chain. CNOOC has established independent technology brands such as CGTank?, CGLiq?, and has become the first energy company in Asia to fully master the core technology of storage tanks and have EPC general contracting capacity.

Yang Hua believes that the proportion of natural gas consumption in primary energy consumption in China is still far behind that in developed countries. According to the 13th Five-Year Plan of Natural Gas, it is expected that the proportion of natural gas in primary energy will reach 10% by 2020. Importing LNG will play an increasingly important role in achieving this goal. China will make positive contributions to global LNG trade and even to the development of global natural gas market in the future.

“With the continuous emergence of new technologies, the continuous innovation of business models and the active participation of more subjects, the global LNG market will become more active.” He believes that while the scale of LNG trade continues to expand, the flexibility and liquidity of global LNG trade will be further enhanced, the main body will become more diversified, contract duration, contract volume, pricing methods and delivery modes will be more flexible, and the volume of short-term and spot trade will be more. Especially in the wave of integration of new technology represented by digitalization and LNG industry, the cost of production, transportation and utilization of LNG will be further reduced, and the price competitiveness will be effectively improved.

However, it is noteworthy that the global LNG industry still faces some challenges. Yang Hua said that the construction and operation costs of facilities such as LNG liquefaction plants and transport ships are still high and the economy needs to be further improved; international LNG prices are greatly affected by market fluctuations and have not yet formed a global unified pricing system, and the Asian premium problem is still prominent; some LNG resource suppliers still adopt the old way to meet the requirements of the same period and trade destination. Strict; large-scale utilization of natural gas/LNG in Asia is still limited by infrastructure bottlenecks and so on.

He suggested that in order to promote the development of global LNG trade, all parties should further promote the innovation and breakthrough of LNG business cooperation mode, jointly explore innovative schemes of business cooperation mode, and improve the flexibility of business contract terms. Asian buyers should further strengthen cooperation, exert the geographic advantages of the world’s largest LNG import region by establishing communication and coordination mechanisms, form a community of interests, and actively explore the establishment of regional natural gas market price index. In order to conform to the development trend of natural gas/LNG market, Asian countries have made the natural gas market open and transparent through market-oriented reforms and other mechanisms. On this basis, they have strengthened contacts and cooperation, optimized the resource allocation of LNG in Asia, enhanced the voice of LNG purchasing pricing, and strived to form the natural gas price index in Asia as soon as possible. In cooperation with LNG exporting countries in natural gas exploration and development, natural gas resources are imported by means of upstream participation and output sharing, so as to ensure the long-term and stability of imported gas sources.

This week, the supply pressure of polyolefin remained high, but at the end of the month, most of the petrochemical plant prices were stable, and the tax adjustment led to some downstream manufacturers to take appropriate orders, the demand was ahead, and the polyolefin futures price showed a weak fluctuation trend. As of Friday’s closing date, L1905 contract closed at 8365 yuan/ton, down 65 yuan/ton per week, 0.77% per week. The highest price in the week was 8455 yuan/ton, and the lowest price was 8275 yuan/ton. In terms of position, the weekly position decreased by 45792 to 3019,000 hands, with a turnover of 969,300 hands. PP1905 contract closed at 8604 yuan/ton, down 3 yuan/ton per week, a weekly decline of 0.03%, the highest 8672 yuan/ton, the lowest 8490 yuan/ton. In terms of position, Zhou’s position decreased by 48,390 to 336,900 hands and turnover by 2.04 million hands.

This week, the spot market of polyolefin is mainly small consolidation, with two light market transactions, no obvious bright spot, the overall stability of TRADERS’quotations, and some small fluctuations. At present, the mainstream price of LLDPE is 8450-8650 yuan/ton, most of which have little change, only a few fluctuate around 50 yuan/ton; the mainstream price of PP wire drawing is 8600-8950 yuan/ton, most of which tend to be stable.

Fundamental analysis:

Cost side: Next week, the international crude oil shock may continue, but the focus is expected to move up. Despite the unexpected increase in U.S. crude oil inventories, it is mainly due to the sharp decline in exports and hindered refinery processing, which can be seen from the decline in refined oil inventories. Therefore, the downward trend of crude oil stocks will not change, and short-term increase will not become a long-term shortfall in pressure oil prices. Later, China and the United States paid close attention to the situation of trade negotiations, and two consecutive rounds of negotiations are expected to give market confidence. In addition, good expectations of overall OPEC output cuts in March also boosted oil prices.

Supply side: PE, this week, the number of domestic petrochemical plant maintenance has decreased, the loss of output is 11.4 million tons. Next week, new maintenance enterprises have Zhongtian Hechuang. Preliminary forecast is that the loss of next week’s maintenance will be around 10.1 million tons, a decrease of 0.13 million tons annually. On the import side, port stocks continue to accumulate slightly, and the overall domestic supply pressure is still in place. For PP, the loss of equipment maintenance this week was about 34.8 million tons, 0.24% less than last week’s 34.9 million tons. Dalian Xitai plans to overhaul next week. It is estimated that the amount of overhaul losses will rise annually, but Ningxia Coal and delayed installation and overhaul plans have been delayed, and the expected overhaul effect is still difficult to reflect in the short term. In terms of new capacity, Jiutai energy supply is expected to be put into the market in mid-April, including PE plant capacity of 300,000 tons, production capacity of 7042, PP plant capacity of 350,000 tons, production of L5E89.

Demand side: PE, with warmer weather, plastic film demand is expected to weaken, pipe market will climb, other downstream start-up changes little. PP, downstream demand remains stable, the overall lack of bright spots. Under the influence of tax reduction, some of the demand is in front of the market. It is estimated that the short and medium-term downstream factories just need to purchase, which has limited support for the market.

Inventory situation: This week coincides with the end of the month, coupled with the reduction of VAT in April, which stimulates some buyers to purchase. Petrochemical inventory declines rapidly. Petrochemical inventory is transformed into social inventory. Tax reform is implemented on April 1, and social supply is under pressure or constitutes the main idea of vacancy. Inventory is expected to decline slowly next week. After the accumulation of holidays, the relatively weak demand can hardly make the inventory consume quickly in the short term. The inventory structure is the key to affect the recent market trend.

In terms of cross-variety arbitrage, PP supply pressure will be greater than PE in the long run this year, but in terms of rhythm, the second and third quarters may be the concentration period for new production capacity. In the short term, we need to pay close attention to the differences between PE and P P in inventory status, late equipment maintenance and new production capacity delivery. At present, the operation is difficult and wait-and-see is appropriate.

Conclusion and suggestions for operation:

Generally speaking, the contradiction between supply and demand in polyolefin market is still prominent in the near future, with fewer overhaul units and high supply. With the production of Jiutai energy polyolefin plant, the domestic production is expected to increase. Influenced by the reduction of value added tax, Petrochemical stocks are converted into social stocks. Tax reform began on April 1, and the social supply is under pressure or constitutes the main empty idea (the pre-sale price of next month has appeared 100).- 150 yuan/ton falls back. However, crude oil is high, cost support is strong, the space below polyolefin is not strong, and the short-term futures have the possibility of repairing the base difference. It is expected that the short-term market will continue to maintain weak shocks, with L1905 pressure level 8800 and support level 8300; PP pressure level 8900 and support level 8400, which need to focus on recent inventory changes, post-plant maintenance and new production capacity. In the long run, polyolefin production in 2019 will continue to increase at a high rate, and the price focus will move downward. It should be noted that this Friday, polyolefin futures night market opened, whether the impact on the market remains to be seen.

As Japan is temporarily granted amnesty in the U.S. sanctions against Iran, with no hope of extending this treatment, Japanese companies will stop importing oil from Iran again after April.

According to the Japan Release Association (NHK) on March 31, US President Trump restarted oil sanctions against Iran in November last year and asked countries to stop importing Iranian oil. But Japan and other countries have temporarily been granted amnesty, which is extended until May this year. As a result, Japanese companies JXTG and Costa Moore Energy Holdings resumed Iranian oil imports that had been interrupted for some time.

Reported that since then, the Japanese government has been in consultation with the U. S. government, but no progress, pardon treatment is not expected to extend. As a result, Japanese companies will stop importing oil from Iran again after April.

Relevant enterprises said that although the proportion of oil imported from Iran is not high, it will not affect Japan’s domestic oil and gas supply. However, the diversification of crude oil imports is indispensable, so the Japanese government will be asked to continue urging the US government to extend the amnesty treatment for Iranian oil imports.

It is understood that on November 5, 2018, the date for the United States to fully resume its blockade against Iran is on schedule. On the same day, the United States Secretary of State announced that eight countries and regions, including China, India, Japan, Italy and South Korea, were granted temporary amnesty for Iranian crude oil imports, which will last 180 days.

According to the data of the U.S. Energy Information Agency, the main exporters of Iranian crude oil in 2017 are China (24%), India (18%), South Korea (14%), Turkey (9%), Italy (7%) and Japan (5%). The U.S. amnesty list covers almost 70% of Iranian oil exports.