Lead-in: Instability in the Middle East continues, compounded by hurricanes causing shutdowns of some US offshore oil wells, keeping crude oil prices at high levels. Additionally, post-holiday restocking demand has boosted Northwest high-olefin C5 prices, leading to a recovery and increase. As of October 10, the average price for Northwest high-olefin C5 was 8,894 yuan/ton, an increase of 401 yuan/ton compared to pre-holiday levels, representing a rise of 4.7%.
I. Comparison of Domestic Raffinate Oil Prices
| Market | Current Period Average | Previous Period Average | Change | Percentage Change | Unit |
|---|---|---|---|---|---|
| Shandong | 7,780 | 8,198 | -418 | -5.10% | Yuan/ton |
| East China | 7,742 | 7,845 | -103 | -1.31% | Yuan/ton |
Domestic raffinate oil prices declined this period, with the average price dropping. The Shandong market price fell, ranging from 7,700–7,930 yuan/ton; the East China market price also decreased, ranging from 7,700–7,750 yuan/ton. During the week, geopolitical conflicts in the Middle East escalated, increasing supply risks and driving up international oil prices. However, gasoline market conditions in Shandong remained weak. Following the holiday, reduced gasoline consumption led to sluggish sales at retail gas stations. Dragged down by weak end-user demand, the raffinate oil market continued its downward trend. Refinery price cuts stimulated shipments. After brief restocking, traders and downstream factories slowed their purchasing pace.
II. Rising International Crude Oil Prices Support Raffinate Oil Costs
Table 1: Comparison of International Crude Oil and Related Product USD Prices (USD/barrel)
| Product | Previous Period | Current Period | Change |
|---|---|---|---|
| WTI | 90.23 | 93.26 | +3.03 |
| Brent | 101.13 | 105.48 | +4.35 |
Data Source: Chempricehub
International oil prices rose, as did the average price. As of October 14, WTI stood at $95.09/barrel, up 3.93% from October 8; Brent was at $106.06/barrel, up 1.71% from October 8. The main bullish factors driving oil prices this week were: Houthi rebels continuing attacks on Saudi Arabia, including strikes on the Riyadh refinery, which heightened uncertainty regarding the Middle East situation and increased supply risks, thereby supporting oil prices.
III. Weak Shandong Gasoline Prices Restrain Raffinate Oil Gains
Shandong independent refineries saw mixed trends in gasoline and diesel prices (92# gasoline priced at 9,852 yuan/ton, down 21 yuan/ton month-on-month (-0.21%), but up 2,495 yuan/ton year-on-year (+33.91%); 0# diesel priced at 9,388 yuan/ton, up 115 yuan/ton month-on-month (+1.24%), and up 3,057 yuan/ton year-on-year (+48.29%)). With international crude oil futures trending upward amidst volatility, Shandong’s refined oil market showed weakness in gasoline but strength in diesel. Post-holiday, end-user demand varied: declining gasoline consumption resulted in flat sales at retail stations, while diesel demand remained decent due to support from agriculture and fishing. Mid-stream and downstream merchants maintained rational ordering, while refineries strongly sought to maintain prices to protect margins.
IV. Post-Holiday Forecast
Crude Oil: International oil prices are expected to see slight upside potential next week, with WTI likely trading between $92–$98/barrel and Brent between $103–$109/barrel. The core logic for next week’s forecast is intensified bull-bear dynamics: risk premiums from Middle Eastern geopolitical disruptions will continue to support prices, but weak demand expectations and Trump’s remarks aimed at suppressing oil prices will exert pressure, limiting the upside space.
Refined Products: Initial expectations suggest an upward adjustment in the next round of wholesale-retail price limits. This news provides a bullish effect on the oil market, so Shandong’s refined oil prices are expected to remain firm. Mid-stream and downstream merchants will continue rational purchasing, refineries will maintain strong price-support intentions, and overall market sentiment will be acceptable. Next week, Shandong independent refinery gasoline prices are expected to dip slightly within a narrow range, while diesel prices may fluctuate higher.
Raffinate Oil: The domestic raffinate oil market is predicted to decline first and then stabilize next week. While crude oil has room to rise and gasoline markets may remain firm, there is currently no significant short-term demand, and market participants lack confidence in the outlook. Therefore, the raffinate oil market is expected to fall initially before stabilizing.
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