Last week, oil prices rebounded after the fall, especially Brent rebounded more, the average value of the ring was basically flat, only the U.S. crude oil for the month led to price declines. On the one hand, the pre-macro pressure under the general decline in commodities, crude oil was not spared, after the market sentiment moderate repair, almost all commodities have achieved rebound; on the other hand, crude oil fundamentals have not changed, and stocks continue to be low, relative to other fundamentally weak varieties, crude oil is a wrong species, therefore, the decline in the relative resistance, the bottom support is strong, and the rebound momentum.

On Friday (July 1) the New York Commodity Futures Exchange West Texas light crude oil futures for August 2022 settled at $108.43 per barrel, up $2.67, or 2.5%, from the previous trading day, with a trading range of $104.56-109.34; Brent crude oil futures for September 2022 on the London Intercontinental Exchange settled at $111.63 per barrel, up $2.60, from the previous up $2.60, or 2.4%, from the previous trading day, with a trading range of $108.03-$112.45. Image

As international oil prices slightly upward, macro sentiment is also tentatively stable, the styrene plate stopped falling and rose slightly; at the same time, near the end of the month, the spot market is more nervous, fill the short demand to push up the spot price; and then a response to the main port inventory in early July or the continuation of the expected decline in basis differences continue to strengthen, so the styrene market shock last week.

Analysis of the outlook for the market

Cost: crude oil this week, near the U.S. visit to Saudi Arabia, OPEC internal meeting, the past two years of production cut meeting will end, the subsequent existence of space for increased production in several countries, such as the United Arab Emirates and Saudi Arabia and other fears will increase production. In addition, the U.S. summer demand peak background, gasoline inventory surprisingly continuous accumulation of storage, and refinery profits began to compress, indicating that the terminal negative feedback has begun, the fundamentals of signs of slackening. Therefore, oil prices are likely to be weakly adjusted.

On the demand side: It is expected that the total domestic ABS production will drop slightly this week compared with last week, and the downstream demand may remain weak.

The styrene spot market is expected to be strong this week, and the performance of the futures market may continue to diverge. From the supply side, the new units will be put into operation plus the restart of the Gulf in early July, and the domestic production is expected to increase by 8.11%. At present, the next cycle of the main port arrival is expected to be 20,500 tons, this week there may be 15,000 tons of export loading at the terminal, exports, although there are plans to ship, but there may be a delay, inventory or a small decline. On the demand side, PS starts may increase slightly this week, ABS starts are expected to decline, EPS starts do not change much, the overall demand performance is stable. On the raw material side, pure benzene and crude oil or weak finishing, cost support is weak. At present, the industry’s view of the market is temporarily strong, mainly supported by the tight spot, but also worried about the impact of crude oil weakness, aromatics prices began to fall, affecting styrene prices. With the domestic public health events comprehensive sweeping, resumption of work and production on track demand is expected to improve, short-term styrene rebounded in anticipation of improved consumption, the medium-term remains short.

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