The price of international oil since the beginning of the year broke through 100 US dollars / barrel, after several months of accelerated growth, this week still stood above 130 US dollars / barrel. China's crude oil imports are relatively large, and petrochemical companies rely on crude oil imports. The increase in the price of international crude oil has a great impact on the production costs of petrochemical companies.

However, the price of refined oil in China has not been liberalized, and domestic refined oil prices have been significantly lower than international refined oil prices. The inverted situation of “the price of flour is more expensive than the price of bread” is currently at a loss.

The industry believes that this situation will certainly be adjusted. It is impossible for the state to allow long-term policy losses to both PetroChina and Sinopec. The price of refined oil may not be released in one step, but there will be policy adjustments to support the two major companies. This kind of policy adjustment is only a matter of time, but this is not the right time. Reconstruction of the Sichuan Earthquake At present, controlling the CPI is one of the top priorities, and it is unlikely that the price of refined oil will be raised in the short term. The stock market has preceded the policy of anticipating the increase in refined oil prices. The value center of petrochemicals stocks was raised from April.

Refining is a loss trading

International crude oil prices soared, breaking through $135/barrel last week. Although this week has declined, it still stands above $130/barrel. China's crude oil import volume is relatively large compared to its export volume. In April, it imported 14.24 million tons of crude oil and only 220,000 tons of crude oil was exported. Therefore, the rise in international crude oil prices will have a greater impact on the cost of China's petrochemical industry.

The price of refined oil in China did not follow the rise in crude oil prices. From the snowstorm at the beginning of the year to the Wenchuan earthquake in May, China’s CPI (consumer price index) continued to rise. In order to control the rapid rise of CPI, despite the fact that international oil prices hit record highs, the price of refined oil in China has not yet been adjusted.

Since last week, the amount of gasoline refueling has been controlled at less than 100 yuan for many cities across the country. The supply of diesel fuel is more intense than that of gasoline. Many large trucks have to line up for long-term refueling. Sometimes they may not be able to add fuel. There is indeed tension in the supply of domestic oil products, because it is necessary to guarantee the supply of refined oil in the earthquake-stricken areas. China Petroleum & Chemical Corporation (hereinafter referred to as "600028" Sinopec) and China National Petroleum Corporation (hereinafter referred to as "China Petroleum") have stated one after another that they will stop export of refined oil and ensure domestic use. After PetroChina held a general meeting on May 15th, Jiang Jiemin, who was the chairman of the company, told the media: “The current supply and demand of refined oil products are in a tight and tight state, reflected in the fact that demand is still relatively strong, but domestic refining capacity is still not fully satisfied. Market supply. In this case, the export of refined oil in the past has now ceased."

China's petrochemical companies have a considerable amount of crude oil that needs to be imported. After the rise in international crude oil prices, its cost has increased significantly. However, the price of refined petroleum products from petrochemical companies did not follow the adjustment of international crude oil prices, resulting in the inversion of raw material prices and product prices, resulting in losses for refinery companies. Hong Yuan Securities analyst Liu Youcheng told the reporter: “PetroChina and Sinopec have no problem in themselves. The main reason is that China has not liberalized the price of refined oil in the policy, and the price of international crude oil has been rising continuously, making the two companies suffer from refining losses. ."

The figures given by Su Shulin, chairman of Sinopec, at the performance announcement in Hong Kong in early April indicated that Sinopec’s gasoline production in March had a loss of RMB 2,162 per ton, and March’s diesel production lost over RMB 3,000 per ton. Liu Jingde, deputy general manager of the Cinda Securities Research and Development Center, also told reporters: “The oil refinery itself has no problem, mainly because the price of the product has been fixed by policy and has not been adjusted for more than half a year. It is a policy-related loss.”

The price increase is expected to support

The State has decided that from April 1, 2008 to June 30, 2008, the import value-added tax policy for the first phase of import of PetroChina’s 500,000 tons of gasoline, 1 million tons of diesel, and 500,000 tons of petrol, and 1.5 million tons of diesel of Sinopec shall be implemented. .

On May 26, the State Administration of Taxation announced the "Naphtha Consumption Tax Exemption Management Measures." According to the management measures, naphtha imported and naphtha used as raw materials for ethylene and aromatics products are exempted from consumption tax. The exemption of the consumption tax for the production of raw materials for ethylene and aromatics products directly reduces the production cost of ethylene, and will obviously benefit the ethylene projects of the refineries of PetroChina and Sinopec. At the same time, it also reduced the manufacturing costs of ethylene and downstream plastic rubber and promoted the development of the organic chemical industry.

The recent two major policies, as well as the long-term losses of refineries, have caused the market to have expectations of higher refined oil prices.

“Our country will definitely adjust this situation, we must not let the oil refining companies have policy losses, the adjustment of the policy is only a matter of time. At present, the market has already seen the expected price increase of refined oil, and the stock price of PetroChina and Sinopec will support the upward trend. Liu Youcheng told reporters.

“The state will definitely make policy adjustments on refining losses, and it cannot allow the two big companies to continue to suffer such losses. The price of refined oil may not rise a lot at once, but it will definitely be adjusted. It is not a suitable time, because Sichuan After the earthquake, in order to control the rapid growth of the CPI, the country will not release oil prices in the short term. In the long run, the policy is good for oil refineries, but it is unlikely that policy adjustments will occur in the short term,” Liu Jingde told reporters. PetroChina and Sinopec's current static P/E ratio hover around 20 times, but this year only last 5 months, the second half may be improved, and in the long term it will be positive. In May, PetroChina and Sinopec's share price were pre-increase in refined oil prices. With support, the value center has been adjusted upwards compared to April."

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May 28, 2025