Since October, the overall international crude oil price has shown a downward trend, and the cost support for toluene has gradually weakened. As of October 20th, the December WTI contract closed at $88.30 per barrel, with a settlement price of $88.08 per barrel; The Brent December contract closed at $92.43 per barrel and settled at $92.16 per barrel.

The demand for mixed blending in China is gradually entering the off-season, and the support for toluene demand is weakening. Since the beginning of the fourth quarter, the domestic mixed blending market has entered the off-season, coupled with the replenishment behavior of downstream before the Double Festival, downstream inquiries have become cold after the festival, and the demand for toluene mixed blending continues to be weak. At present, the operating load of refineries in China remains above 70%, while the operating rate of Shandong Refinery is about 65%.

In terms of gasoline, there has been a lack of holiday support recently, resulting in a decrease in the frequency and radius of self driving trips, and a decrease in gasoline demand. Some merchants restock moderately when prices are low, and their purchasing sentiment is not positive. Some refineries have seen an increase in inventory and a significant decline in gasoline prices. In terms of diesel, the construction of outdoor infrastructure and engineering projects has maintained a high level, coupled with demand support from sea fishing, agricultural autumn harvest, and other aspects, logistics and transportation have performed actively. The overall demand for diesel is relatively stable, so the decline in diesel prices is relatively small.

Although PX operating rates remain stable, toluene still receives a certain level of rigid demand support. The domestic supply of paraxylene is normal, and the PX operating rate remains above 70%. However, some paraxylene units are under maintenance, and the spot supply is relatively normal. The crude oil price trend has risen, while the PX outer market price trend has been fluctuating. As of the 19th, the closing prices in the Asian region were 995-997 yuan/ton FOB South Korea and 1020-1022 dollars/ton CFR China. Recently, the operating rate of PX plants in Asia has been mainly fluctuating, and overall, the operating rate of xylene plants in the Asian region is around 70%.

However, the decline in external market prices has put pressure on the supply side of toluene. On the one hand, since October, the demand for mixed blending in North America has continued to be sluggish, the Asia US interest rate spread has severely shrunk, and the price of toluene in Asia has decreased. As of October 20th, the price of toluene for CFR China LC90 days in November was between 880-882 US dollars per ton. On the other hand, the increase in domestic refining and separation, as well as the export of toluene, coupled with the continued increase in toluene port inventory, has led to increasing pressure on the supply side of toluene. As of October 20th, the inventory of toluene in East China was 39000 tons, while the inventory of toluene in South China was 12000 tons.

Looking ahead to the future market, international crude oil prices are expected to fluctuate within the range, and the cost of toluene will still receive some support. However, the demand support for toluene in industries such as downstream mixing of toluene has weakened, and coupled with an increase in supply, it is expected that the toluene market will show a weak and narrow consolidation trend in the short term.