Download App

[Caixin Futures: Energy and Chemical Sector Under Pressure, Most Commodities Remain Weak] ⑴ Geopolitically, the US continues to intervene in the Russia-Ukraine negotiations, but the effects are still not obvious, and the possibility of a short-term end to the conflict is unlikely; the US is preparing to seize more oil tankers off the coast of Venezuela, and geopolitical tensions continue. ⑵ However, recently, crude oil prices have encountered pressure and fallen back between the 20-day and 60-day moving averages, while global land and sea inventories remain high. Downstream refined oil demand is weak, and inventories have rebounded beyond seasonal norms, so crude oil prices are expected to fluctuate weakly. ⑶ The recent geopolitical situation has become more complex. The Russia-Ukraine peace talks are still ongoing, but a result is unlikely in the short term, and the probability of a US military strike against Venezuela is increasing. The expectation of reduced supply of high-sulfur fuel oil due to sanctions remains, but crude oil prices are expected to fluctuate weakly due to weakening downstream demand. ⑷ Losses have worsened, and expectations for float glass cold repairs and production conversions have strengthened, but the market is worried about an early rebound in prices, leading to delays or cancellations of cold repair plans. Furthermore, midstream inventories are large, causing spot and futures prices to fall again. (5) Overall, glass demand has weakened significantly year-on-year, with a clear "low valuation and weak driving force," and prices are expected to fluctuate weakly at low levels. If the year-end cold repair plans are gradually implemented, the downside will be limited. (6) The Alashan Phase II plant has been ignited, and the new production line of the Applied Chemical Plant will also be ignited, bringing renewed pressure on the supply and demand sides. On Monday, the total inventory of domestic soda ash manufacturers increased by 38,700 tons compared to last Thursday, an increase of 2.59%. (7) Overall, with more major plants undergoing maintenance in December, soda ash can basically achieve a supply-demand balance supported by low operating rates. However, the market is still suppressed by declining costs, expectations of supply recovery, and overcapacity. Short selling on rallies is advisable. (8) On December 15, spot prices for liquid soda ash showed mixed trends. The significant destocking last week and this week was mainly due to the delivery of previously signed outsourced orders. After the phased destocking, some companies began to rebound at low prices, but the supply-demand imbalance remains unchanged, and caustic soda is still in a state of high supply and high inventory. (9) The current weak market sentiment persists, and with alumina prices continuing to fall and expectations of production cuts strengthening, coupled with the off-season for non-aluminum products, caustic soda prices are likely to remain low and fluctuate. (10) Today, the spot price in Taicang was 2103, down 2, while the price in Inner Mongolia North Line was 1955, down 12.5 from the previous month. With near-month arrivals being relatively high, current inventory levels high, and a large number of warehouse receipts, bullish funds are hesitant. Due to the risk of reduced imports in distant months caused by Iranian gas restrictions, the near-term outlook remains weak while the far-term outlook remains strong. The downside potential for the 05 contract may be limited. (11) The methanol market is expected to remain stable in the short term, with price fluctuations narrowing.