The oil supply deadlock between Russia and Saudi Arabia continues, and global demand is declining.
Countries have successively implemented "cities lockdowns" due to the new crown epidemic, and oil prices have fallen to their lowest levels in nearly 20 years.
In the later stage, there is no substantial benefit in the international crude oil market, and Asian ethylene prices continue to drop, and the domestic PE market is also dragged down.
Let's take a look at how PE futures are falling.
Affected by the continued decline in international crude oil prices and the meltdown of US stocks, the domestic polyethylene market fell sharply in 2020.
The highest price of the L05 contract reached 6,985 yuan/ton in the month, and the lowest reached 6065 yuan/ton.
The monthly high-low price difference reached 920 yuan/ton.
As the delivery month enters, the operation of shifting the far-month 09 contract increases, and the 5-9 spread continues to shrink, or to give a certain rebound in recent months.
Affected by the epidemic, the global economy has entered a period of recession.
With the Fed's unlimited easing, financial markets have continued to decline.
The resumption of domestic polyethylene demand is gradually advancing.
Although there is a marginal improvement, due to the problem of rework by non-local workers, the operating rate cannot be increased rapidly, and the raw materials are more rigidly needed to purchase, and the speculative demand is relatively small, which is not enough to help the price increase.
Furthermore, with the global spread of the epidemic, export orders have also been affected.
At present, petrochemical inventories are still at relatively high levels over the same period of the year, and the overall supply is gradually increasing.
In addition, crude oil and ethylene have fallen sharply, which has a downward drag on polyethylene prices.
, It is expected that the domestic polyethylene market still has room for decline in the short term.