Crude Oil Prices Plummeted, Polyester Fiber Products Prices Also Collapsed.

After the tragic end of February, the global risk assets staged a bleak start in March, and the global risk aversion is still clouded. Crude oil and the epidemic have become key changes in the market.

On Friday, OPEC and Russia collapsed, unable to reach a further reduction of 1 million 500 thousand barrels per day. On Saturday, Saudi Arabia immediately launched a "comprehensive oil price war": substantially reducing the price of its major crude oil at different levels, the largest reduction in at least 20 years, which means that it will increase production and seize the market and bring as many crude oil into the market as possible. In March 9th, Brent crude oil futures opened sharply lower, opened 25% lower, and then fell over 31%, to 32.14 U.S. dollars / barrel; WTI crude oil futures fell rapidly to 27% to 30.07 U.S. dollars / barrel.

For the next trend of oil prices, the market is generally pessimistic, it is understood that the last time the OPEC negotiations broke down in 2015, when OPEC insisted on competing with shale oil, intended to kill shale oil in the cradle. But after that, we all know that crude oil prices fell further from US $50 to US $27. There is a panic in the market. Although we can not say that oil prices will still fall to US $30 or even below US $30, the short-term downward trend has already been established.

Even if the Federal Reserve suddenly cut interest rates 50 basis points this week, we did not see the decline in macro market risk preference. Instead, the Fed cut interest rates and increased the degree of market self doubt. The only thing that can provide a good boost to the oil market is the stabilization of the macro environment. But even so, the fundamental slash of the fundamentals makes future oil prices full of pessimism.

Therefore, the short-term oil price is still pessimistic. First, there is no obvious logic in the macro level. Two, the fundamentals will be in a situation of oversupply for a long time. Three, there has been a trend of breaking the oil price. Of course, the price of oil may rebound this week, but where is the bottom of the market before the failure of the alliance fails to return to negotiations? Only the market knows.

With the international oil prices being washed up, PTA and ethylene glycol are hard to get rid of, and there has been a sharp decline. Commodity futures closed down, crude oil, PTA, ethylene glycol and other varieties closed down.

A historic low opening is the brewing of the mood of the weekend, and a direct manifestation of the war of Russia. This extreme market is not a response to anyone. A large number of stocks may be bankrupt after undertaking huge inventory, and the whole industry can be expected to be hit. And for China's crude oil processing industry will usher in a huge low-cost dividends, the overall cost of China's crude oil imports is a big positive.

Meanwhile, the intensification of overseas epidemic and the import and export trade are also blocked. At present, there are four marine oil markets in the world, namely, the Asian region (Singapore, Japan, South Korea, China, Hongkong, China), accounting for 28.57% of the total ship oil in the world. The European ARA region (Amsterdam, Rotterdam and Antwerp) accounts for 6.25%, while the Mediterranean region (Fujairah) accounts for 8.25%, while the Americas (east coast of the Americas) account for 5.93%. The epidemic has already broken out in these parts of the country. In order to prevent the spread of the global epidemic, many countries have begun to introduce a policy of berthing the "epidemic areas". The demand for marine oil has been suppressed. From Singapore's residual oil inventory, inventory is constantly accumulating, and the storage speed is obviously faster than in previous years.

In fact, before the new crude oil slump, the raw material of polyester has actually stabilized. However, if the city gate is on fire, the fish will inevitably suffer. This volatile market will be brought back into the whirlpool of oil prices again. In 2015, for example, when the oil price dropped and the downstream demand was weak, the average operating rate of the domestic PTA industry was only 67.17%. The average price of the product dropped by 28% over the same period last year, so the future of polyester raw materials is not optimistic.

Crude oil collapsed again, the trade situation was tense, and the terminal market also appeared a cliff type cooling, which aggravated the bearish sentiment, caused the market atmosphere to suddenly cool down, the terminal demand continued weak, and the downstream replenishment enthusiasm was very low. Jiangsu and Zhejiang polyester yesterday clinch a deal, to 3 p.m. near the production and marketing average estimated at 3-4 percent. The main contradiction in the current market is not the price level, but the lack of confidence, the order is not large, and the demand is hard to raise.

The collapse of crude oil prices has not only led to a decline in prices of raw materials such as PTA and ethylene glycol, but also the collapse of cost of polyester fiber products, such as the price of POY150D has fallen below 7000, or 20%. At present, the stock of polyester factories continues to accumulate, and the downstream demand is not enough. If the cost of this line of defence is also lost, polyester polyester products will continue to look for new low support points.