Market Overview

According to a large number of data monitored by business associations, the price of dichloromethane in Shandong rose sharply this week. At the beginning of the week, the average price of dichloromethane in Shandong was 3000 yuan/ton, and at the end of the week, the average price was 3400 yuan/ton, with an increase of 13.33% in the week.

quotations analysis

Products: This week, due to the overhaul of Jinling Chemical Industry in Shandong Province, the overall supply of dichloromethane market is tight. Enterprises and traders have limited shipments and low inventories. At present, the quotation of bulk water remittance in Shandong is around 3400 yuan/ton, 3800 yuan/ton in Jiangsu and 3750 yuan/ton in Jiangxi. In terms of start-up, at present, the time for Jinling chemical plant to be repaired and restored is uncertain; Dongying Jinmao fully loaded operation; Luxi chemical plant to start 60%; Jiangsu science and technology plant to start normal; Jiangxi science and technology plant to run normally, etc.

Industry chain: In the upstream, the natural gas market is gradually warming up, with a small 1.1% in a week, and the average price at present is about 3363 yuan/ton; the liquid chlorine market is stable and weak, and the reservoir pressure of enterprises is relatively large. Enterprises in North China offer more than 1 yuan/ton, subsidized freight is about 100 yuan/ton, and East China is affected by overhaul, reporting more than 500 yuan/ton. Domestic R410a market shocks adjustment, refrigerant downstream market demand is flat, mostly export orders.

Forecast for future market

Business Club dichloromethane data analysts believe that the overall start-up of dichloromethane production enterprises is low, spot supply is tight and inventory is low, although the current downstream market demand is flat, but will soon enter the peak demand season for refrigerants, dichloromethane market is expected to be strong in the near future.

Price Trend

According to the data from the business associations’list, the price of domestic dry-process aluminium fluoride Market declined this week, with an average market price of 9,500 yuan/ton at the beginning of the week and 9,333 yuan/ton at the end of the week, which was 1.75% lower than that of last week.

II. Market Analysis

Aluminum fluoride prices remained stable this week: at present, the price of aluminium fluoride in Henan is between 8500 and 9200 yuan/ton, while that in Shandong is between 8500 and 9200 yuan/ton. Zhengzhou Zerun Energy and Chemical Co., Ltd. quoted 8500 yuan/ton of aluminium fluoride, Shandong Luzeng Chemical Co., Ltd. 11000 yuan/ton of aluminium fluoride and Henan Zhongse Dongfang Shaoxing Industrial Co., Ltd. 9500 yuan/ton of aluminium fluoride.

Industry chain: This week, the price of hydrofluoric acid rose slightly. Enterprises reported that the spot supply of hydrofluoric acid in the market has decreased. Recently, the situation of on-site goods has improved. Some enterprises have low start-up rate of hydrofluoric acid plants and slightly increased ex-factory prices. However, the downstream market performance of aluminium fluoride is general, and the market price is close to the cost line. The market price of dry-process aluminium fluoride is still declining this week.

3. Future Market Forecast

Analysts of Aluminum Fluoride Industry of Business Society Chemical Branch believe that the price of hydrofluoric acid, the upstream raw material, has fallen to a higher level, and the price of Aluminum Fluoride is expected to rise next week.

Natural rubber is one of the important strategic basic materials in China, and Yunnan is the largest natural rubber production base in China. The Ministry of Industry and Information Technology of Yunnan Province recently issued the Implementing Plan of Yunnan Province Supporting the Development of Rubber Industry, proposing that Yunnan Natural Rubber Agriculture should achieve output value of 9 billion yuan by 2020, optimize industrial layout and structure, develop rubber products industry, basically form a modern marketing system, and further enhance the voice of the international market.

According to the statistical data, by the end of 2017, the planting area of natural rubber in Yunnan Province was 8.66 million mu, accounting for 49.5% of the total planting area in China. The output of natural rubber was 438,000 tons, accounting for 53.8% of the total national output. The agricultural output value of natural rubber reached 6 billion yuan.

The plan put forward that we should consolidate and improve the management level of rubber plantations, improve the development quality of natural rubber preliminary processing industry, speed up the development layout of rubber deep processing industry, establish and improve the supporting service system of rubber industry, improve and expand the construction of rubber warehousing and logistics system, expand the influence of rubber trade market, enhance the leading enterprises in rubber industry, promote the construction of key projects and enhance them. The main tasks of enterprises in 10 aspects are the level of technological innovation and strengthening investment promotion and attraction.

The plan points out that by 2020, the planting area of natural rubber in Yunnan should be stabilized at about 9 million mu, the production area should be 6 million mu, and the annual output of natural rubber should be 600,000 tons. The output value of natural rubber agriculture should reach 9 billion yuan, and the per capita income of rubber farmers should reach 7,000 yuan.

At present, the problem of oversupply of polypropylene market has not been alleviated, and the price is weak as a whole. However, considering that Sino-US trade frictions and US sanctions on Iran will affect the quantity of imported plastic products and stimulate oil prices, polypropylene futures prices are expected to rebound in the near future.

Strong support from peripheral factors

Recently, periphery macro-risk events occur frequently, which has a great impact on commodity prices.

First, the United States imposed a crude oil embargo on Iran in November last year. However, considering the high dependence of some countries on Iranian crude oil, the United States granted eight countries and regions, including China, Japan and South Korea, exemptions from importing crude oil from Iran. However, in May this year, the United States announced an escalation of sanctions against Iran, requiring earlier exemption countries and regions to stop importing crude oil from Iran. At the same time, in response, Iran threatened to block the Strait of Hormuz, which greatly threatened the transportation of crude oil in the Middle East. OPEC’s April monthly report estimated that global crude oil demand in the second quarter was 99.18 million barrels per day and supply was 98.42 million barrels per day. Among them, non-OPEC countries supply 63.35 million barrels per day, OPEC unconventional oil and gas and liquefied petroleum gas supply 5.55 million barrels per day, OPEC crude oil supply 3.2 million barrels per day, with a supply gap of 76 million barrels per day. In March, Iran’s crude oil output was 2.698 million barrels per day. If the U.S. comprehensive crude oil embargo against Iran is implemented, the global crude oil supply gap will be further widened. Although OPEC can partly compensate for Iran’s shortfall by increasing production, it will take some time. Therefore, international crude oil prices will strengthen as a whole, which will give strong support to PP futures prices.

Second, since last year, Sino-US trade frictions have been plaguing the two countries and even the global economy. After many rounds of negotiations, the differences between China and the United States have become smaller and smaller, and the market generally believes that the Sino-U.S. trade frictions will be resolved. However, recently, US President Trump declared in the social media that he would continue to impose tariffs on China. Sino-US trade frictions intensified and the market fell into panic. China needs to import a large number of plastic products from the United States. If the trade friction between China and the United States escalates or can not be solved, the plastic products imported from the United States will decline. The resulting supply gap will be filled by the domestic market, which invisibly increases domestic demand and has certain support for the price of polypropylene.

We believe that there are more market risk events in the near future, and commodity prices are more affected by peripheral factors. In the short term, market panic causes commodity prices to fall, but as the market returns to rationality, peripheral factors will have a positive impact on polypropylene.

The pattern of supply exceeding demand is difficult to change

The weakness of supply and demand is the main reason for the continued weakening of polypropylene price, but at present, the supply and demand side of polypropylene has not obviously improved. From the supply side, although the production profit of polypropylene has declined due to the continuous rise of crude oil price before, because of the lower price of olefin monomer, the profit of oil-based PP is 700 yuan/ton at present, and that of coal-based PP is 2000 yuan/ton, and the production enthusiasm of enterprises is still high. In this case, the polypropylene production enterprises which had been repaired in the early stage began to resume production one after another. At the end of April, Qilu Petrochemical Company, Yanshan Petrochemical Company and Wuhan Petrochemical Company resumed production one after another. This week, Qinghai Salt Lake will drive, and the market supply will increase further. From the demand side, due to the weakness of the real estate market, the consumption of white household appliances in the past two quarters is not as strong as in previous years, which makes the demand for polypropylene decrease. In addition to the current pessimistic terminal market sentiment, downstream enterprises mainly buy ready-to-use purchases, and there was no centralized stock market before the May Day holiday. Under the combined effect of increased supply and weak demand, the accumulation of polypropylene during the May Day holiday was higher than expected.

In summary, polypropylene has been interwoven in many vacancies in recent years. On the one hand, the sanctions imposed by the United States on Iran and the escalation of trade disputes between China and the United States will increase the price of crude oil and decrease the import of plastic products, thus supporting the price of polypropylene. On the other hand, due to poor terminal demand and weak supply and demand in the polypropylene market, slow de-inventory will suppress the price of polypropylene. In this case, we believe that it is difficult for the polypropylene market to form a trend. However, with the recent end of the callback, polypropylene has a certain buying value.

Aluminum price has been a good non-ferrous variety since this year, especially since April. Whether it can maintain its rising trend in the future depends mainly on downstream demand and re-production capacity. On the demand side, the recovery of real estate is relatively strong, and the marginal increase of re-production capacity is relatively weak. Aluminum prices are expected to fluctuate strongly in the second quarter.

Macroscopic data is better

In April, China’s official manufacturing industry PMI was 50.1, down 0.4 percentage points from last month, and remained in the expansion range for two consecutive months, but the extent was weakened; in March, China’s M2 grew by 8.6% year-on-year; in March, China’s social financing scale increased by 2.86 trillion yuan, 1.28 trillion yuan more than the same period last year. Among them, M2 and social finance data are more than expected.

From the perspective of electricity consumption, China Telecom Union disclosed March 2019 electricity data: in March, the total social electricity consumption was 573.2 billion degrees, an increase of 7.5% over the previous year, which exceeded expectations. From January to March, electricity consumption was 1.6795 trillion yuan, an increase of 5.5% over the same period last year. In March, China’s electricity generation was 569.8 billion degrees, up 5.4% year-on-year; in January-March, it was 1.6747 trillion degrees, up 4.2% year-on-year.

In terms of railway freight volume, the cumulative year-on-year rates of January, February and March 2019 were 8.2%, 3.3% and 3%, respectively, showing a weak recovery. In January, February and March of 2019, the RMB loan balances of China’s financial institutions were 87.18 trillion, 87.92 trillion and 89.03 trillion respectively, with an increase of 14% year on year, which was relatively neutral. At present, broad credit is still conducting downward, and the sustainability of tax cuts and fee cuts is strong, and China’s economy will continue to recover.

“Xiaoyangchun” in the real estate market

Aluminum for construction accounts for about 33% of the total consumption of aluminium in China. According to the statistics bureau, the investment in real estate development increased by 11.8% from January to March, which was higher than 11.6% from January to February, and the new construction area increased by 11.9% from January to February, which was significantly higher than 6% from January to February. From January to March, the sales area of commercial housing decreased by 0.9% compared with the previous two months, and the sales volume of commercial housing increased by 5.6% compared with the previous two months, and by 2.8% in the previous two months. At the end of March, the area of commercial housing for sale was 516.46 million square meters, down 9.9% from the same period last year.

According to the survey data of housing enterprises, in the first four months of this year, sales of 75 Housing enterprises exceeded 10 billion yuan. Among them, sales of five leading housing enterprises, including Biguiyuan, Vanke, Hengda, Poly and Rongchuang, exceeded 100 billion yuan. While sales remained stable, real estate enterprises took land actively, and the phenomenon of land premium rate exceeding 100% reappeared. Eighteen enterprises took land more than 5 billion yuan in a month, which broke the monthly record of land market in the past year or so. Among them, Rongchuang, Biguiyuan, Xincheng, Zhonghai, Huarun, Greentown, Rongsheng, Jindi and other eight enterprises have more than 10 billion yuan in land.

This is closely related to the marginal improvement of financing channels for housing enterprises. In April, the intensive release of financing by housing enterprises approached 260 billion yuan, and the scale of financing approached 850 billion yuan. However, due to the high leverage rate of Chinese residents and the positioning of the central “housing is not speculative”, the “Xiaoyangchun” property market will be difficult to sustain for a long time, but it will still support the aluminum price in the medium term.

Power electronics and transportation accounted for 14% and 12% of China’s aluminium consumption, respectively. According to data from China Ride Federation, retail sales of generalized passenger cars in March were 1.78 million, down 12% from the same period last year, falling for 10 consecutive months, showing a cliff stall, and the automotive industry has yet to see a turning point. According to the State Grid Corporation’s Social Responsibility Report 2018, the State Grid’s planned investment in 2019 is 512.6 billion yuan, an increase of 4.84% over last year’s actual completion, which is relatively neutral.

Resumption of production

With the rapid rise of aluminium price since April, the profit level of electrolytic aluminium industry has recovered to a certain extent, but it is not enough to stimulate large-scale resumption of production. The current time also corresponds to the successive resumption of production capacity of Weiqiao in Shandong Province due to its shutdown in response to the policy of production restriction in autumn and winter. In November 2018, Weiqiaoguan in Shandong Province shut down production capacity of about 500,000 tons. On April 15, Shandong Province Announcement Document “Announcement on 542,000 tons of capacity replacement scheme for electrolytic aluminium in Shandong Weiqiao Aluminum and Electricity Co., Ltd.” According to the plan, Weiqiao in Shandong Province needs to dismantle its original capacity after the replacement capacity is put into operation, and the expected start-up time is 6 months. This capacity is expected to put pressure on aluminium prices after the second quarter.

In the first quarter of this year, the cumulative production of domestic electrolytic aluminium was 8.633 million tons, a decrease of 1.2% compared with the same period last year. Among them, the output in March was 2.981 million tons, down 1.5% from the same period last year. As supply and demand remain tight, the second quarter fundamentals remain optimistic. However, due to the widespread expectation that higher aluminium prices will stimulate more large-scale re-production, and Weiqiao replacement capacity is approaching, it is expected that the price of aluminium will be dominated by strong shocks.

In recent years, the domestic fertilizer market as a whole has shown a relatively weak trend, the demand for raw materials is not strong, potassium chloride temporarily maintains price stability, but the follow-up supply is relatively large, the domestic market weakening signal release. The supply of imported potassium is still loose. In the conservative mentality of new single trading, the downward price focus exists.

The quotation of domestic potassium enterprises is steady to support the downstream shipment. The arrival price of 60% crystal powder of Salt Lake benchmark products remains unchanged, maintaining 2350 yuan/ton, but the rebate policy is changed to 50 yuan/ton; Tibetan Ge 60% powder/crystal 2350 yuan/ton, 57% powder/crystal 2200 yuan/ton; 60 mainstream 2200-2250 yuan/ton of market outlet.

Affected by the end of spring fertilizer production and procurement in Northeast China, the supply radiated to North China market and the price widened. The price of big granules in Yingkou Port was 2300-2350 yuan/ton, while the price of white potassium in border trade Port was 62% 2050-2080 yuan/ton. The actual transaction was negotiated.

Most of the potassium imports from ports are concentrated in the hands of large distributors. The quotation is stable. The price of 62% white potassium in ports is more than 2350-2380 yuan/ton. The actual transaction is mainly negotiated according to the order.

With the end of the domestic spring inspection, the increase in supply is inevitable, while imports will also pick up, the port inventory will continue to increase.

In the case of increased supply and difficult to increase demand, methanol weak market will continue. With the end of the domestic spring inspection, the increase of production equipment, the subsequent supply of methanol will continue to increase, at the same time, foreign devices are also facing the completion of maintenance after the restart situation, the import volume will gradually increase. From the demand side, MTO downstream product prices are falling, the enthusiasm of enterprises to purchase methanol is low, MTO demand is difficult to increase, traditional demand changes little.

As a result, the low price of methanol is inevitable.

Spring inspection is coming to an end Into April, methanol spring maintenance launched, the start rate decreased significantly, but with the increase in subsequent production devices, the start rate will gradually pick up. According to Jin Lianchuang statistics, April 25, the national methanol construction rate of 63.58%, a rise of 0.93%, which is the first recovery after four consecutive weeks of decline, of which the Northwest Territories start rate of 74%, a rise of 5%, mainly in the early April maintenance of the device has been re-production, such as Jutai, Huating, Jintai Thai 51 pre-production, And the new Austrian two, rongxin maintenance device is also in the restart, it is expected that the opening rate of northwest China will continue to rise after the festival.

May, although there are still some pre-delayed maintenance of the device into the overhaul, but the completion of the pre-maintenance after the restart of more devices, the start rate will show a gradual upward trend, the domestic supply pressure is increasing.

Expected increase in imports The maintenance of foreign installations is also coming to an end, and imports will pick up again in May. According to the General Administration of customs, 2019 years ago two months of methanol imports in 1.616 million tons, 3 April forecast will fall to about 650,000 tons, and May will again recover to more than 700,000 tons. Methanol prices fell sharply in the four quarter of last year, leading to the early entry of international installations in February-March, such as Iran ZPC330 million tons of equipment completed in March, the current operation is smooth, Iran Marjan175 tons of methanol plant in March after parking to complete the restart in early April ; The Malaysian oil company’s 2.36 million-ton device was restarted at the end of March and is now functioning well; the Venezuelan Metor255 million-ton device was also restarted before 51 knots. In terms of arrival, the number of arrivals in early April began to increase significantly in mid-April, Taicang, Changzhou, Zhangjiagang and other places in May can be tense, according to the current arrival volume calculation, port inventory will rise again.

As a result, imports will increase significantly in May, with increased supply-side pressure.

Port MTO Profit is low Port olefin prices fell sharply at the end of 2018, leading to MTO profits have been low and demand for methanol has been difficult to increase. Crude oil prices fell sharply in the four quarter of last year, and downstream crude oil products were not spared, and the port MTO combined profit was at a low level. In the case of ethylene glycol, a vinyl product, the supply and demand side deteriorated with the production capacity, and the price of ethylene glycol fell by nearly 40% from 7500 yuan/ton in early October 2018 to the end of April 2019. Acrylic end product PP price fell less, but also 20%. Taken together, the port MTO profit is at a low level in the past five years, which will affect the progress of the production of 1.8 million tons of new devices in Nanjing Zhicheng two. In addition, the MTO plant is expected to resume in early May, Qinghai Salt Lake Olefin device in mid-April to stop again, restart to be determined.

For now, MTO demand is difficult to increase. On the traditional demand side, it is also difficult to have a big upturn.

Formaldehyde construction rate of 28.25%, the weekly decline of 1.6%, acetic acid start rate of 80.71%, the weekly increase of 10.72%, other changes are small. To sum up, with the end of domestic spring inspection, supply increase is inevitable, while imports will also pick up, port inventory will continue to increase. From the demand side, MTO profit has been maintained at a low level since this year, which not only affects the production of new devices, but also affects the subsequent procurement volume of methanol, while traditional demand is affected by environmental protection is also difficult to increase. In the case of increased supply and difficult to increase demand, methanol weak market will continue.

BP recently released the 2019 Chinese version of BP World Energy outlook in Beijing.

According to the BP World Energy outlook, natural gas will become a major increase in future energy consumption in the outlook period, with an average annual growth rate of 1.7% per cent for natural gas supply and demand, that is, an increase of almost 50% per cent by 2040, the only energy to grow as a share of renewables.

A rapid growth of natural gas consumption in China Data show that China’s total energy consumption of 4.64 billion tons of standard coal in 2018, an increase of 3.3% over the previous year. In terms of segmentation, coal consumption increased by 1%, crude oil consumption increased by 6.5%, natural gas consumption increased by 17.7% and electricity consumption increased by 8.5%.

Coal consumption accounted for 59% of total energy consumption, down 1.4% from the previous year, crude oil consumption accounted for 20.3% of total energy consumption, an increase of 0.6%, natural gas, hydropower, nuclear power, wind power and other clean energy consumption accounted for 20.7% of total energy consumption, an increase of 0.8%.

From the BP Outlook, the absolute amount of coal consumption in China will decline in the future, the absolute amount of crude oil consumption still has a small growth space, but the proportion of both will be further compressed, and the natural gas market still has more than 200% of the huge growth space, which is the next 20 years China’s primary energy growth point. Unlike the abundant reserves of coal resources, China’s limited reserves of oil and gas resources have been difficult to meet the rapidly growing demand for oil and natural gas consumption. China overtook the United States as the world’s largest importer of crude oil in 2017, surpassing Japan as the world’s largest importer of natural gas in 2018. Especially in recent years, due to rapid economic development, rising energy demand triggered a steady increase in imports, crude oil imports 462 million tons in 2018, import growth rate of 10%, natural gas imports exceeded 90 million tons (125.4 billion cubic meters), the growth rate is up to 32%. The data show that China’s crude oil dependence degree in 2018 has reached 72%, natural gas external dependence reached more than 45%, and this external dependence is becoming more and more serious.

The final share of crude oil imports is likely to exceed 75%, approaching 80%, the share of natural gas imports will exceed 50% in 2 years, and consumption will continue to grow by 200% over the Outlook period, and imports will also have much room for growth. By comparison, we can find that natural gas production in recent years has maintained a relatively rapid growth, which mainly stems from the large-scale development of natural gas resources in China late, there is still a certain capacity potential can be excavated.

For the crude oil industry, which has been developed earlier, the production capacity has been basically fully excavated, and some oilfields have passed the peak production period. China’s crude oil production has been basically stable since 2010, and has even declined in recent years. Although there are differences in the potential of the production end, the combination of the two lies in a significant increase in external imports at the same time, because only increasing imports can meet China’s demand for crude oil and natural gas resources.

B Global distribution of natural gas reserves Natural gas is a collective term of mixed gas with hydrocarbon as the main body in underground rock reservoirs, with a specific gravity of about 0.65, which is lighter than air and has the characteristics of colorless, tasteless and non-toxic. The main ingredient alkanes, of which methane accounts for the vast majority, with a small amount of ethane, propane and butane.

As a clean energy source, it can reduce sulfur dioxide and dust emissions by nearly 100%, reduce carbon dioxide emissions by 60% and NOx emissions by 50%, and has become more and more widely used in China’s industrial and civil fields in recent years. By the end of 2017, the top ten countries with proven global natural gas reserves were Russia, Iran, Qatar, Turkmenistan, the United States, Saudi Arabia, Venezuela, the UAE, China and Nigeria, with Russia’s proven reserves of up to 34.97 trillion cubic meters. Five of the world’s top ten natural gas fields are located in Russia, namely Urengoy, Shtokman, Yamburg, Zapolyarnoye, Bovanenko gas fields. Siberia’s natural gas reserves account for about 50% of Russia’s total reserves.

GAZPROM is the world’s largest producer of natural gas. Russia has now become an important importer of natural gas in China because of its abundant natural gas reserves and its proximity to China.

After the completion of the East line of the Sino-Russian natural gas pipeline, 38 billion square natural gas (about 34 million tons of oil equivalent) is delivered to China at the highest annual level. The proven reserves of natural gas in Iran and Qatar are 33.22 trillion cubic metres and 24.92 trillion cubic metres, respectively, with the world’s largest natural gas Tinampars field, a large part of which is located in Iran (the other part is in Qatar). According to the International Energy Agency (IEA), an estimated 51 trillion cubic metres of natural gas and 50 billion barrels of condensate are stored in the South Pars gas field. It is worth mentioning that, according to the total reserves of proven oil and gas equivalent (crude oil + natural gas), Iran reached 382.2 billion barrels, nearly 18% per cent higher than Saudi Arabia (321.3 billion barrels in Saudi Arabia).

In other words, Iran is actually the real first oil and gas power in the Middle East, not Saudi Arabia. Turkmenistan ranks # 17.5 trillion of the world’s proven reserves of natural gas, converting 115.5 billion barrels of oil equivalent, which is higher than the proven oil reserves (102.4 billion barrels) of Russia as a whole. It is important to stress that China’s PetroChina has invested heavily in natural gas projects in Turkmenistan.

Turkmenistan is the country that supplies the largest number of natural gas to China, and its natural gas is an important source of gas in China’s west-to-east gas transmission. Shale gas in unconventional natural gas is a market hotspot in recent years, and according to a May 2018 report by the United Nations Conference on Trade and Development (UNCTAD), China ranks first in the world (up to 31.6 trillion cubic meters) in shale gas reserves, which is close to the proven reserves of Russian gas; Argentina ( 22.7 trillion cubic metres), Algeria (20 trillion cubic metres), the United States (17.7 trillion cubic metres) and Canada (16.2 trillion cubic metres) ranked second to fifth, respectively. Currently, the world’s total exploitable shale gas reserves are expected to reach 214.5 trillion cubic metres, a total reserve equivalent to 61 years of global natural gas consumption in the current context. The report, which is also confirmed in a forecast by the U.S. Energy Information Administration (EIA), says China has the resources to become the largest shale gas reserve (1115 trillion trillion cubic feet, 31.6 trillion cubic meters), far more than Argentina, now the world’s second-largest shale gas reserve country.

The crux of the problem is that large-scale shale gas mining is currently carried out only in North America, where the United States and Canada are located, and China is significantly ahead of other countries in terms of shale gas reserves, with deep mining potential, but there is still a big difference between the potential and ability of shale gas mining and the proven recoverable reserves, and it is still not known how

C major producers of natural gas Statistics show that the global share of production in the United States and Russia in the major gas producers in 2017 was 20% and 17%, respectively. After the shale oil revolution, the United States produced more natural gas than Russia, and still has great potential for development.

Notably, natural gas production in the Middle East has been growing at a high rate since 2000, and it will be a central force in the global increase in natural gas during the outlook period. Iran, Qatar Although the current phase seems to be a large gap with the United States and Russia gas production, but the subsequent potential is huge, two countries with abundant reserves in the future is expected to catch up, it appears that the two countries are increasing investment, increase their domestic gas exports, in recent years the growth rate is clear, the future to occupy a larger market share will be a foregone

Turkmenistan, which also has a huge reserves, is not in the top ten producing countries, but for my country, as an important supplier of resources, its status is very important for the security of our energy supply, and steadily advancing the country’s natural gas development is a reasonable way to cooperate. China is the sixth largest natural gas producer, because of weather, environmental protection and other reasons, China itself does not export natural gas, but need to import a large amount of natural gas.

D major consumer countries of natural gas The “2018 domestic and foreign oil and gas Industry Development Report” released by the China Petroleum Group Institute of Economic Technology shows that global gas consumption in 2018 was about 3.86 trillion cubic meters, a growth rate of 5.3%, 2.3 times times the average of 2.3% in the past 5 years. Among them, the United States, Russia, China ranked in the top three consumer countries. About 1.21 trillion cubic meters of natural gas in the world need to be imported to meet consumer demand, accounting for about 1/3 of total natural gas consumption, importing countries, China, Japan, Germany, the top three, import volume exceeded 100 billion cubic meters, especially China’s 2018 years of imports jumped nearly 35 billion cubic meters,

Reached 125.4 billion cubic metres. U.S. gas consumption is well ahead of other countries, with total gas consumption of 848.135 billion cubic meters (82.06 billion cubic feet per day) in 2018. EIA predicts that future U.S. gas consumption will grow steadily on the basis of 2018. Natural gas, after oil, is the second largest source of energy consumption in the United States, accounting for about 29% of total primary energy consumption in the United States.

2017, the main consumption of natural gas in the United States in five industries: industry, accounting for 35%; Power generation, accounted for 34%; civil, accounted for 16%; commerce, accounting for 12%; and transport, accounting for 3%. Russia, the world’s second-largest consumer of natural gas, consumed 454.5 billion cubic metres in 2018. Previous data show that Russia’s primary energy consumption composition of natural gas accounted for 53.6%, followed by oil accounted for 19.1%, coal accounted for 16.4%, nuclear power accounted for 5%, hydropower accounted for 5.9%. The main areas of natural gas consumption are power generation and household consumption.

75% of the natural gas consumed by Russian domestic industry and residents is supplied by Gazprom, which had a domestic supply of 307 billion cubic meters to Russia in 2005. China ranks third in global gas consumption, consuming 276.6 billion cubic meters of natural gas in 2018. In terms of consumption structure, according to the data of Prospective research institute, Urban Gas, industry and power generation gas are the main driving forces of natural gas consumption growth, accounting for 36%, 33% and 22% of total natural gas consumption respectively, and chemical gas use accounts for about 9%. In the face of huge demand growth rate, although China has made efforts to increase domestic production, but still far from meeting the demand, natural gas imports quickly increased, 2018 China’s natural gas dependence of more than 45%, the second half of the annual up to 48%. According to the forecast, China’s natural gas consumption in 2019 will exceed 300 billion cubic meters, an increase of 11.3% year-on.

The government’s “Blue Sky Defense” action Plan continues to be implemented, and the environmental factors will continue to be the main driving force behind the short-term promotion of domestic gas demand in various localities to strengthen the management of scattered coal.

E natural gas Import in China presents diversified pattern China’s annual imports of natural gas from abroad include pipeline gas and LNG two ways, the current LNG import ratio of nearly 60%, pipeline gas imports about 40%, which is different from the global natural gas trade pipeline gas and LNG accounted for a greater difference. 2018 Global Pipeline Gas trade volume of 771 billion cubic meters, the global LNG trade volume of 324 million tons (440.6 billion cubic meters), pipeline gas trade accounted for up to 64%.

By comparison, we can find that pipeline transportation still has great growth potential in the growth of China’s natural gas industry. At present, China’s pipeline gas trade imported pipeline gas used in the transmission pipeline and domestic gas connection, imported LNG relies on the construction of LNG receiving station for transit storage. Of all the overseas LNG entering the receiving station, about 30% per cent were re-gasified and entered the pipeline, and about 70% were shipped to the downstream consumer markets in the form of LNG, such as tankers, which would change significantly with the establishment of the national oil and gas pipeline company. At the beginning of 2019, the national oil and gas pipeline company formation program has been approved and included in the 2019 SASAC key work plan, is expected to be formally established this year.

The establishment of oil and gas pipeline company is mainly to solve the problem of interconnection of natural gas pipe network and lag of pipeline construction. According to the “2018-2023 China New Energy industry development prospects and Investment Strategic Planning Analysis Report”, the main importer of pipeline natural gas in China is Turkmenistan, accounting for 83% of total imports, and other importing countries are Myanmar, Uzbekistan, Kazakhstan, especially from Uzbekistan

, Kazakhstan’s imports of pipeline gas increased significantly by 25%, an increase of 15% over the previous year; LNG mainly imports Australia, Qatar, Malaysia, Indonesia, the total number of four countries accounted for 81%. Although Russia is a major gas producer and has a geographical advantage bordering China, it has previously imported very little natural gas from Russia. Data show that in 2018, China only imported 730,000 tons of natural gas from Russia, accounting for less than 1% of the total import volume. With the completion of the construction of the corresponding pipeline in the future and the completion of large LNG projects such as Yamal, China will import more and more natural gas from Russia, and it is expected that by 2020, China’s natural gas import pipeline gas transmission capacity can reach 127 billion cubic meters, of which the Chinese and Russian import pipeline gas capacity can reach 60 billion cubic meters.

Review of the impact of oil price trend between 一、五一期 Entering the May, the United States formally imposed sanctions on the Iranian side, cancelling the immunity of other countries from crude oil imports to Iran’s crude oil. In addition to the OPEC release to continue to cut production of good support, oil prices have been temporarily rebound opportunity. However, U.S. crude inventories grew by an increase in net imports to their highest level since September 2017, while U.S. production refreshed highs again, while uncertainty over sanctions on the Iranian side exacerbated the fall in international oil prices, according to US EIA data.

It then rebounded temporarily or slightly under favourable conditions for the dollar to fall and Russia to continue to cut production.

Ii. Analysis of US EIA data this week Inventory aspects: As of April 19, the Week, U.S. crude oil inventories 460.633 million barrels, the highest level since October 2017, up 5.48 million barrels from the previous week; the total U.S. gasoline stock was 225.826 million barrels, down 2.13 million barrels from the previous week; the distillate oil depot stock was 127.029 million barrels, down 660,000 barrels from the previous week.

The Cushing area has a crude oil stockpile of 44.912 million barrels, an increase of 463,000 barrels. Import and export aspects: As of April 19, the Week, Last week, U.S. crude oil imports averaged 7.149 million barrels a day, an average of 1.157 million barrels a year from the previous week, and a daily average of 2.681 million barrels of U.S. crude oil exports, an increase of 280,000 barrels a day over the previous week, an increase of 350,000 barrels over the same period last year, and an average of 4.468 million barrels of net U.S. crude oil in the past week

。

Processing: As of April 19, the total amount of refinery processing in the United States averaged 16.583 million barrels per day, an increase of 505,000 barrels compared with the previous week, and the refinery start rate was 90.1%, an increase of 2.4% over the previous week. Yield: As of April 19, the average daily production of U.S. crude oil was 12.3 million barrels, an increase of 100,000 barrels a week compared with the average daily output.

Three, multi-empty influence against each other

1, the factors of profit and multi: Venezuela’s political crisis has intensified, threatening the state’s export of crude oil, which has fallen as a result of US sanctions.

Thousands of marchers rallied this week in response to opposition Leader Guardiola’s call for May 1 to hold an operation against President Nicolas Maduro. The U.S. government has asked all buyers to stop importing Iranian oil from this week or face sanctions.

Previously, OPEC member Iran’s eight largest buyers, most of them Asian countries, were allowed to import a limited amount of Iranian oil. The Saudis welcomed the US move to end all Iranian sanctions exemptions and said they were prepared to meet the needs of oil consumers by replacing Iranian oil supplies. Meanwhile, Saudi energy ministers say there has been a lot of discussion with energy ministers from other oil-producing countries, and basically everyone wants the deal to cut production to be extended.

In addition to the Saudi energy minister: Saudi crude oil exports are expected to be below 7 million barrels/day by the end of May.

Iran’s oil minister, Zangane, said in Thursday (May 2) that Iran would respond if other OPEC members threatened Iran’s interests. In Friday, the Labor Department reported a significant 263,000 increase in non-farm employment in April, with unemployment falling to 3.6%, a low of more than 49 years.

In addition, the labour participation rate in April fell to 62.8% per cent in the previous 63%. It is reported that two industry sources said May 3, because of Russian crude oil contaminated with organic chlorinated pollution caused by serious disruption of exports, Russian oil producers have received the pipeline Monopoly Enterprise Transneft notice, demand to reduce production by May 7 900,000 tons.

The figure is estimated to be equivalent to about 10% of Russia’s total oil production, equivalent to a production cut of more than 1 million barrels/day in the coming days.

2, the negative factors:

Russian oil output fell from 11.3 million barrels per day in March to 11.23 million barrels per day in April, but is still higher than the target set by the agreement to cut production, according to data released by the Russian Ministry of Energy in Thursday.

U.S. crude inventories increased to their highest level in September 2017 due to net imports of crude oil for January, while U.S. crude oil production rose to a record high of 12.3 million barrels/day, according to EIA data.

China’s April official manufacturing Purchasing Managers ‘ index (PMI) fell to 50.1, down from the median survey estimate of 50.5, down 0.4% from the previous month, and in April the/Markit China Manufacturing Purchasing Managers Index (PMI) fell to 50.2, with the median survey estimated at 51.0 and 50.8 respectively last month.

Iv. Pre-market preview The United States has formally begun to impose full sanctions on Iran, removing exemptions from other countries for crude oil imports from Iran. It is worth noting that U.S. stocks on the Iranian side of the sanctions can be approved by China, Turkey and other major Iranian crude oil imports have not yet been decided. From processing for a short time to find Iran crude oil substitution has its own and difficulties. Iran’s current export volume in 1 million barrels per day, once it becomes 0, Saudi Russia and other countries can not close the supply gap in the short term, while Iran’s crude oil exports are completely restricted, the greater possibility of armed blockade of the Hormuz, Str. Of, increase supply disruption, oil prices will be a big rise in the opportunity. So the focus of the market will shift to the OPEC conference and whether the United States is again exempt from Iranian crude oil imports.

Since May 2, the United States has formally suspended its crude oil export exemption from Iran in an attempt to impose a total ban on Iranian crude oil exports. 3rd–The United States also announced the strengthening of restrictions on Iran’s nuclear activities.

The analysis argues that U.S. sanctions against Venezuela and OPEC-led production cuts have already caused a shortfall in global crude supply, at a time when the continued decline in Iranian crude oil exports will trigger a shock in the global crude oil market.

Iran’s crude oil exports continue to slide Last May, the United States unilaterally announced its withdrawal from the Iran nuclear deal, restarted economic sanctions against it, and demanded that the countries concerned stop importing Iranian crude oil on November 4, 2018.

Last November, the United States announced additional sanctions against Iran, but allowed the eight largest importers of Iranian crude oil to continue importing limited quantities of crude oil from Iran, including China, Turkey, India, South Korea and Japan.

Previous U.S. sanctions have halved Iran’s daily exports to 1 million barrels, or less, while the suspension of exemptions for Iran’s crude oil exports means the United States will cut Iran’s crude oil exports to 0. An Iranian official familiar with crude oil policy said Iran’s crude oil exports could fall to 700,000 barrels a day, or even as low as 500,000 barrels, from May. Iran’s crude oil exports could remain around 40 to 600,000 barrels a day, an OPEC source said.

Analysts at Energy Aspects expect Iranian crude oil exports to fall to about 600,000 barrels a day from May.

For now, market participants generally believe that Iran’s crude oil exports have fallen from at least 2.5 million barrels a day in April 2018, one months before US president Trump withdrew from the U.S. nuclear deal with Iran. In April, the White House issued a public statement demanding that all Iranian crude buyers must stop importing by May 1 or face sanctions, the Wall Street Journal reported.

The analysis says the White House aims to cut the lifeline of Iran’s annual revenue of $50 billion in crude oil to pressure the Iraqi side to limit its nuclear program and ballistic missile tests. That sparked resentment in Iran, where Iran’s oil minister, Biyang Zangne, told members of Congress that the Trump Administration’s sanctions waiver plan would never be met: “It is impossible for the United States to expect to cut off Iran’s oil exports. We will do our best to break the United States sanctions.

” Iran is bypassing U.S. sanctions to sell crude oil in the “grey market,” a senior Iranian Oil ministry official said 5th. State media the Islamic Republic of Iran news agency quoted Amir Hussein Zamaninha, deputy minister of oil, as saying Iran “has mobilized all the country’s resources to sell crude oil in the ‘ grey market ‘.”

Zamaniya did not explain the meaning of the “grey market” and the details of the disclosure, including the volume of crude oil exports. Iranian Foreign Minister Javad Zarif told Reuters April 25 that “there is always a way to bypass the sanctions” and that the Iraqi side will make every effort to continue selling crude oil. Zarif declined to disclose the oil sales targets considered by the Iraqi side.

Zamaniya said 5th that the Iraqi side in the “grey market” oil sales “is not smuggling, but to resist illegal sanctions by the United States.” Iran’s oil minister, Zangane, said 1st that Iran had launched a number of new channels to secure oil exports. Mr Zan said oil exports were the most important part of Iran’s oil industry and that Iran might allow private capital to invest in Iranian oil in the future.

Increased uncertainty in crude oil market OPEC secretary General Balquindo said it was impossible to remove Iran completely from the global crude oil market, and the reduction in Iran’s crude oil output would exacerbate the threat to the global crude oil market.

Balquindo said the OPEC secretariat was in discussions with Iran’s oil ministry about the response. Some OPEC members now face international sanctions. OPEC’s general secretary, Balquindo, said in Tehran 2nd that OPEC would do its utmost to avoid a global “energy crisis.” ‘ We will continue to focus on the goal of avoiding an energy crisis because it could affect the global economy, Balquindo said.

OPEC members have pledged to be united and not to fall back on the chaos they have faced in recent years. Although US President Trump has asked Saudi Arabia to take the lead in increasing oil production to make up for supply shortages caused by U.S. sanctions against Iran, the Saudi energy minister has said the country will not rush to increase crude oil supplies and will continue to comply with a deal to cut production reached by major oil producers late last year, possibly even extending the deal until the end of the year.

That means the Saudis still want to maintain the current state of production cuts. Under the current deal to cut production, OPEC producers and non-OPEC producers, led by Russia, will cut production of 1.2 million barrels of crude oil a day until the end of June this year.

OPEC and its allies will meet in Vienna from June 25 to 26th to discuss the next production plan.

But when it comes to the impact of the situation in Iran on the oil market, Saudi Energy Minister Khalid Falih has said there is no shortage of supply in the world market, there is nothing to worry about.

Multi-country calls for resumption of dialogue

After terminating the oil import exemption, it is theoretically that no country or region has a legal way to trade crude oil with Iran, and it is difficult for any bank to deal with operations involving Iran’s crude oil transactions, and all shipping vessels exported by Iranian crude oil may also be seized by the United States Navy.

The High Representative of the European Union and the foreign ministers of France, Germany and Britain issued a joint statement on the Iran nuclear deal on the 4th, expressing regret and concern at the United States decision not to grant any countries and regions the exemption to continue importing Iranian crude oil, and expressing concern that the United States should end its exemption from some of Iran’s nuclear non-proliferation projects within the framework The statement said the parties involved in the Iran nuclear deal are committed to maintaining Iranian capital flows and export trade, and are working with relevant third parties to support the Iranian nuclear deal. The EU and Franco-German and British will continue to work with other European partners to maintain legal trade with Iran, particularly through the INSTEX clearing mechanism for trade with the country. In addition, the participants concerned will significantly increase their financial support for the INSTEX clearing mechanism. France, Germany and the United Kingdom issued a joint statement earlier this year announcing the establishment of a INSTEX clearing mechanism for trade with Iran.

The mechanism, which is full of “trade support Tools”, is a payment mechanism operating outside the US-led global financial system, helping European companies bypass unilateral U.S. sanctions against Iran and allow the EU to continue trading with Iran. Over the past year, US sanctions have taken a huge hit on Iran’s economy. According to the International Monetary Fund, inflation in Iran has soared to 40% per cent since the US restarted sanctions against Iraq, and 42,000 of miles has been able to exchange 1 of dollars. The IMF expects Iran’s gross national product (GDP) to continue to decline this year.