China Times (Chinatimes. net. cn) reporter Gong Peijia reports from Beijing
After a series of roller coasters, will international crude oil prices hover low in 2019 or hit $100 again?
"Brent oil is expected to cost between $60 and $70 a barrel in 2019." On December 20, SINOPEC Economic and Technological Research Institute issued the "China Energy and Chemical Industry Development Report 2019" (hereinafter referred to as the "Energy Report"). The energy report believes that the global energy and chemical market environment is undergoing profound changes, and the transformation and high-quality development of refining and chemical industry marks that the industry is about to open a new chapter.
This is close to Brent's oil price in 2019, which was predicted by the U.S. Energy Information Agency (EIA) not long ago. According to a report released by the U.S. Energy Information Agency, the trend of international oil prices next year will be weaker than previously anticipated, because global oil production remains high and demand may be weak. Brent's average price is expected to be $61 a barrel, down by $10.92 compared with the previous expectation. The main reasons for lowering oil prices include the high production of the world's top three oil producers and the global plateau. Oil demand is weak.
Increased Game Induces Market Turbulence
International crude oil prices are pulling the whole body together.
"World oil demand is expected to increase by about 1.2 million barrels per day in 2019, below 2018 levels." According to the energy report, crude oil prices rose by more than 30% in 2018 due to the faster rebalancing of international oil supply and demand, the geopolitical situation and the influence of the United States on international oil prices than expected. Since October, market supply and demand have reversed again and oil prices have declined.
It is understood that the energy report is the first annual research report issued by the state-owned enterprises covering the development of the whole industrial chain of economy, energy, oil refining and chemical industry in China. It includes three modules of economy, industry and hot topics. It runs through the three major sectors of energy, oil refining and petrochemical industry, covering six major industrial chains and more than 40 products of energy and chemical industry. A comprehensive analysis of China's energy and chemical industry in 2018 is made. Market characteristics, the development trend of the industry in 2019 was systematically predicted, representing the deep understanding of the industry and market of the top 500 national oil companies and excellent research teams at home and abroad.
In 2019, the domestic demand for natural gas is expected to increase by 10% year on year, and the market regulation capacity is constantly increasing. China has become a major natural gas consumer, with demand reaching 277 billion cubic meters in 2018, a strong 17% increase over the previous year. Urban gas, industrial gas and power generation gas are the main driving forces driving consumption growth, accounting for 91% of the total natural gas consumption.
In order to ensure supply, the government encourages enterprises to increase exploration and development, both conventional and unconventional, and to increase imports, without large-scale gas shortage. In 2018, Tianjin, Shenzhen, Zhoushan, Fangchenggang and other new LNG handling projects were put into operation, which provided diversified options for natural gas imports. Infrastructure interconnection also played an important role in the market guarantee.
At the same time, under the multi-party game, the uncertainty of international oil market is increasing.
In recent years, from the perspective of supply-side structure, the dominance of the oil market has shifted from OPEC to the tripartite game between Russia and the United States. In 2019, U.S. crude oil production, which has basically achieved energy independence, will increase steadily with the alleviation of inland pipeline bottlenecks, which will inevitably increase the pressure of excess supply. On the other hand, Saudi Arabia and Russia led the production reduction agreement aimed at balancing the market, but considering that Russia and some exempt countries have weak implementation of production reduction, the actual boost effect of the production reduction agreement on oil prices is limited.
According to the energy report, market risks still lie in geopolitical aspects. The following changes in Iran's nuclear sanctions, the Libyan civil war, the Syrian war and the Yemeni crisis may also cause unexpected fluctuations in oil prices. Overall, Brent oil prices will average between $60 and $70 a barrel in 2019.
Four Challenges in the Silver Age of Refining Industry
The energy report just released also points out that the domestic oil refining industry will face four new challenges after experiencing the Silver Age.
In 2018, the operation of domestic refining industry and the development of refined oil market have three main characteristics: the net profit of petroleum processing industry has increased by about 40%, and the rise of oil price is the main reason; the consumption of petroleum exceeds 600 million tons, the external dependence reaches about 70%, and the growth rate of crude oil processing is faster than that of refined oil production; the purpose of the new consumption tax policy "No. 1" is to make the tax payment behavior of refineries more standardized. The operating environment of refined oil suppliers needs further purification.
Based on this, the domestic refining industry will face four major challenges in 2019:
Firstly, the large-scale integration of new private enterprises has brought about a significant increase in refining capacity of 45 million tons per year, reaching 880 million tons per year.
Second, while demand keeps growing at a low level (a small increase of 2% in terminal consumption), the export of refined oil products will increase to about 51 million tons. The main reason is the double decline of macro economy and automobile sales. The demand for chemical raw materials is better than the growth of the demand for refined oil. Small refinery and large chemical industry will become one of the directions for the transformation of traditional refineries.
Thirdly, the upgrading of oil quality, especially the entry of low sulfur ship fuel required by IMO, requires refineries to carry out adaptable transformation.
Fourthly, the overall marketization of refined oil is accelerating. The construction of gas stations is open to foreign investment and the formation mechanism of refined oil price is open. The latter has a great impact on the market. Refining and sales enterprises need to be prepared in advance.
"In 2019, the overall profitability of the world's petrochemical industry will come back in stages, but the overall level is still at a high level; the global trade pattern of petrochemical products such as polyethylene, PX and methanol may undergo major adjustments, and Europe will face
