White Oil Price Dropped on Sluggish Demand
Last week, the international crude oil prices performed well on relatively optimistic market atmosphere. Though the public health event in Europe and the U.S. was still severe, these countries had decided to vaccinate their people extensively, supporting the international crude oil market sentiment. Moreover, the decrease in the U.S. crude oil stocks and the loose monetary policy adopted by the FED supported the international crude oil prices as well.
However, in China, the strong international crude oil prices gave limited support to the white oil market. Most participants adopted a wait-and-see attitude, and some participants adjusted their prices by RMB 50-200/mt. According to SCI’s statistics, up to December 21, the average price of 5# white oil in China was RMB 4,767/mt, while the average price of 3# white oil was RMB 4,850/mt.
As for supply-demand fundamentals, in December, the units at most white oil producers ran steadily except that the 600kt/a hydrogenation unit at Shandong Jincheng Petrochemical experienced a 10-day maintenance. In early December, many traders and downstream users replenished their inventory intensively, and the white oil inventory at producers was at a low level. However, in the last several days, traders and downstream users mainly purchased on a need-to basis, and the sales at white oil producers weakened to some extent.
