On June 2, international oil prices rose significantly, and the market expected OPEC+ to extend the production reduction agreement. As of the close of the day, the July NYMEX WTI crude oil futures contract closed at $36.81/barrel, an increase of 3.87%. The ICE Brent crude oil futures August contract closed at $39.57 per barrel, an increase of 3.26%.
According to foreign media reports, OPEC+ is considering extending the production reduction plan to July or August, and The meeting originally scheduled for June 9-10 may be brought forward to Thursday. According to OPEC+’s original plan, after ending the first phase of 9.7 million barrels per day of production cuts at the end of June, production capacity cuts will be adjusted to 7.7 million barrels per day from July to the end of the year.
On the morning of June 1, Premier Li Keqiang of the State Council said during an inspection in Yantai, Shandong Province that the street stall economy and the small shop economy are important sources of jobs and are the fireworks of the world. “Same as above” is the vitality of China. This is the second time in recent history that Premier Li Keqiang has praised the street stall economy. On the afternoon of May 28, after the closing of the third session of the 13th National People’s Congress, Premier Li Keqiang attended a press conference and answered questions from domestic and foreign reporters. He affirmed Chengdu’s approach to developing a street stall economy to solve employment problems.
Recently, oil and fat sectors including soybean oil, palm oil, and rapeseed oil have continued to rise. According to analysts, the government’s recent promotion of the development of the street stall economy is expected to generate new growth points for oil consumption.
International oil prices continue to soar, and the chemical sector performs strongly
June On the 2nd, international oil prices rose significantly, and the market expected OPEC+ to extend the production reduction agreement. As of the close of the day, the July NYMEX WTI crude oil futures contract closed at $36.81/barrel, an increase of 3.87%. The ICE Brent crude oil futures August contract closed at $39.57 per barrel, an increase of 3.26%.
According to foreign media reports, OPEC+ is considering extending the production reduction plan to July or August, and may extend the production reduction plan to July or August. The meeting on June 9 and 10 has been brought forward to this Thursday. According to OPEC+’s original plan, after ending the first phase of 9.7 million barrels per day of production cuts at the end of June, production capacity cuts will be adjusted to 7.7 million barrels per day from July to the end of the year.
There is evidence that OPEC+’s production cuts have been effective. Russia’s production dropped to 9.39 million barrels per day last month, far lower than the 11.35 million barrels per day in April and close to OPEC+ goals.
The recent trend of the chemical sector has been relatively strong. Dai Yifan, an energy and chemical analyst at Nanhua Futures, told a reporter from Futures Daily that the chemical sector was generally warmer this week, and there were two leading factors: First, macro factors. Last weekend, U.S. President Trump’s speech was better than market expectations; second, crude oil continued to Strong. “The OPEC+ production cuts we currently observe are much better than in previous years, especially Russia’s implementation, and there is currently an expectation of extending production cuts. As European and American countries gradually resume work, crude oil is still on a relatively strong upward channel. Among them.” Dai Yifan said.
For PP, Dai Yifan said that after experiencing a wave of mask prices in the early stage, there was another upward breakthrough this week. The recent demand feedback from the entire plastic sector has been very good, regardless of the epidemic zone. The incoming demand for masks and protective equipment, or the explosion in demand for home appliances and automobiles brought about by the shift in demand, have injected full impetus into the rise. Together with the new demand, the apparent demand growth rate from January to May has been very high. Although more production has been put into operation after August this year, the overall macroeconomic outlook has recovered, market funds are relatively abundant, real demand and speculative demand have been supported simultaneously, and apparent demand has maintained a high growth rate. Inventories are currently at a low level, and the start of production will put greater pressure on the 2001 contract, while the impact on the 2009 contract will be relatively limited.
As for PVC, Dai Yifan believes that this is a very strong type of chemical products at present. “Similar to PP, PVC is also a demand-led market. Real estate has shown very strong resilience in demand throughout the second quarter, which is beyond many people’s expectations. The supply side also has some help, and the logic of the previous short-term focus was mainly Due to the impact of imports and the increase in domestic production after profit recovery, imports are currently obviously lower than expected,” he said.
“In terms of output, although the profit recovery is obvious month-on-month, it is still relatively low year-on-year. After the maintenance season has passed, the load increase speed is much slower than previously expected. In the supply chain, Against the background of weak demand and strong demand, PVC has rebounded, but the current price is close to the pre-epidemic price, and it is not recommended to chase the price,” said Dai Yifan.
“From the overall perspective of the chemical sector, from a macro perspective, we need to pay attention to the second outbreak of the epidemic after the resumption of overseas work, especially the situation after the resumption of work in Europe and the United States; from a micro perspective, we need to pay attention to prices. After the rebound, some previously loss-making companies have restarted. Chemical products are still in a large cycle of production. If the supply increases very quickly, industrial profits will still need to be compressed.” Dai Yifan said.
The oils and fats sector has a long-term basis for growth
In the near future, including soybean oil, Oils and fats sectors including palm oil and rapeseed oil continued to rise. Zhang Yimeng, a researcher on oils and fats at Huarong Rongda Futures, believes that from the overall perspective of the oils and fats sector, first of all, the domestic epidemic has been effectively controlled, consumption vitality has been released, and the street stall economy has been developed.Against the backdrop of the daily average hot metal production reaching new highs, iron ore port inventories continue to decline, with overall supply exceeding demand.
From the news perspective, there are market rumors that Vale will lower its annual production target, and due to the intensification of the local epidemic, the company’s third largest mining area, Itabira, will be blocked . “Although Vale later issued an official statement in a timely manner, claiming that the group had taken various safeguard measures to deal with the epidemic, its production and operations were operating normally and was not affected by the epidemic, and this year’s production plan target remained unchanged, but the market expected that iron ore supply would continue in June. Less than demand, there is still room for decline in port inventories. Therefore, the trend of iron ore is still strong after the rebound.” Fang Jiaju said that in addition, from the perspective of the entire coal, coking and steel ore industry chain, the market expects that coking coal will be carried out for the fourth time in June. A round of price increases has also helped iron ore to strengthen further.
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