May China MTBE Prices to See a Reverse V-Shaped Trend
Although the international crude oil prices dropped notably during the May Day holiday, China’s MTBE prices inched up, as downstream users replenished stocks before the holiday.
With the approach of the May Day holiday, most MTBE producers intended to cut inventory before the holiday. The decline in MTBE prices stimulated the downstream procurement enthusiasm, dragging down the inventory at MTBE producers. During the holiday, the international crude oil prices decreased dramatically, but China’s MTBE prices edged up, as sales of MTBE performed well. After the holiday, the overall MTBE prices moved upward, but the overall trading atmosphere underperformed, as most buyers adopted wait-and-see attitudes to the MTBE market.
Downstream users replenished stocks temporarily after the holiday, giving thin support to the MTBE market. Accordingly, it is estimated that China’s MTBE prices will probably increase at first and then go down in May 2024.
In April, operating rates of MTBE units at sample enterprises went up, as overhauled units were restarted gradually. According to SCI’s data, MTBE unit operating rates averaged 58.94% in April, down 1.33% M-O-M and up 5.31% Y-O-Y. Therein, the average operating rate of isomerization unit reached 56.87%, down 0.89% M-O-M, and that of iso-butane dehydrogenation unit was 72.05%, down 1.13% M-O-M. With overhauled units being restarted in May, it is predicted that the overall MTBE supply may be ample.
Some refineries may take overhauls in May, so it is predicted that the gasoline output may edge down, and most market participants may adopt bearish attitudes to the MTBE market. Most buyers may adopt cautious attitudes, so the overall MTBE demand is likely to give thin support to the MTBE market.
It is predicted that China’s MTBE export volume may total 200kt in May, alleviating the supply pressure. With the international crude oil prices declining, the international MTBE prices may drop notably, exerting bearish impacts on the export negotiation in June. Accordingly, it is predicted that China’s MTBE prices may fluctuate downward.
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