EU delays talks on Russian oil price cap
On November 25, Bloomberg quoted people familiar with the matter as saying that the Russian government is preparing a decree that will prohibit Russian companies and any traders who purchase the country’s oil from selling oil to any country participating in the implementation of Russia’s oil price ceiling. The decree would prohibit transactions with companies and countries that participate in price cap mechanisms, but did not specify how “participation” in the mechanism would be defined.
People familiar with the matter believe that this will essentially prohibit any mention of price caps in contracts to buy Russian crude or refined products, and prohibit oil shipments to any country that imposes such caps. It is unclear how much of an impact the price caps or Russia’s response decree will have on international crude oil trade, as formal supporters of the caps no longer buy Russian oil and the caps are actually targeted at other major consumers, such as India.
In addition, EU diplomats will not meet on Friday or over the weekend to discuss the Russian oil price cap as divisions within the bloc remain deep-rooted. EU diplomats had been optimistic that a deal could be finalized on Friday, but the parties remain unwilling to make enough concessions and have now postponed discussions until after this weekend.
The news that Putin plans to announce a “national mobilization” is untrue
According to a report by RIA Novosti on the 25th, Russian Presidential Press Secretary Peskov said on the same day that the news that President Putin was about to launch a “national mobilization” when delivering the State of the Union address was not consistent with the facts.
It is reported that a publication called “Pravda.ru” previously published relevant news. The source said, “When Putin delivers his State of the Union address, he must mobilize both officers and soldiers as well as the economy.”
When asked whether the above news was true, Peskov gave a negative answer. Previously, Peskov said that the specific date for Putin’s State of the Union address has not yet been determined and is expected to be held at the end of the year.
The energy and chemical sector shows a trend of differentiation
Yesterday, the trend of the energy sector in the domestic commodity futures market diverged, with most varieties rising. The main contracts of PVC, glass, and low-sulfur fuel oil futures rose by more than 3%. The largest decline was styrene, with the main contract falling by 1.53%, and crude oil. , staple fiber and rubber fell slightly.
Zhong Meiyan, assistant to the director and energy director of Everbright Futures Research Institute, said that the trends of crude oil and oil products have recently diverged, and the trends of petrochemicals and coal chemicals have also diverged. Among them, varieties with short positions in the early stage have shown an upward trend of increasing positions, such as PVC and methanol prices. The rebound was the largest, with low-sulfur fuel oil and asphalt also rebounding, while the polyester segment PTA and staple fiber were still weak. “The logic driving the trend differentiation of the energy sector has two aspects: First, policy support has led to an improvement in macro sentiment, and oversold varieties will usher in valuation recovery; second, the main contract is approaching delivery, and total positions are still at a high level, and market gaming may further intensified.”
Dong Dandan, chief researcher of CITIC Futures Energy and Chemicals, said that the main reason for the divergence of trends in the energy and chemical sector is the difference in basis and inventory. Products with large increases generally have low inventory and high basis, such as polyolefins, asphalt, etc. The basis difference is large. The 2301 contract is approaching delivery, and there is a possibility of upward subsidy in the futures market.
“The main contradiction in the energy and chemical sector currently lies in the fluctuation difference between raw material costs and product prices. Since this year, the center of gravity of crude oil prices has moved upward as a whole, while the price of petrochemical products has been weak and cannot keep up with the increase in raw materials. As a result, product profits have shrunk, causing a load on the industrial chain. Passively reduce the burden. As the center of gravity of crude oil prices shifts downward, product-side profits begin to be passively restored.” Zhong Meiyan believes that relatively low raw material costs are an important factor driving positive feedback in the industrial chain. Subsequent raw material prices will remain relatively low, and chemical industry The marginal recovery of product terminal demand is expected to drive the continued recovery of chemical product profits.
Zhong Meiyan said that from the perspective of industry chain varieties, the prices of products with high cracking profits are expected to recover downwards, while the inhibitory effect of high-priced raw materials on downstream products is gradually emerging, so the market will still resonate in the short term. From the perspective of the oil and chemical sector, empty supply is still the main focus, and low-sulfur fuel oil and other previously relatively strong varieties may slowly weaken; asphalt phased demand support is insufficient, and the price center is expected to continue to find the bottom; polyolefins, polyester Chemical products such as oil and gas, PVC, methanol, etc. are likely to resist the decline. The main reason is that the early market valuation is low and the cost impact is declining. Investors can go long on the processing profits of oil chemical products.