Ethylene oxide fell sharply by 500 yuan / ton on Wednesday, followed by another 200 yuan / ton in Jihua on Thursday. At present, the mainstream market price is 6550 yuan / ton, the ex factory price in Central China is 6650 yuan / ton, and Jihua is 6350 yuan / ton.

Upstream, the interest rate hike of the European Central Bank triggered demand concerns, the price of international crude oil futures fell, and the trading on the floor has been relatively quiet. Insiders tried to weigh the supply tightness caused by the weak energy demand and the reduction of Russian oil after the conflict between Russia and Ukraine. Naphtha spot valuation fell to $78.14 / barrel. Northeast Asia ethylene remained at 860 US dollars / ton in the week. As of the closing of Asia on July 21, the spot price difference between ethylene and naphtha was $104.5 / ton, and the continuous loss situation of cracking unit has not been alleviated. Moreover, the domestic epidemic is sporadic, and the sealing and control policy may aggravate the low profit situation in the downstream, which continues to pose pressure on the demand side of naphtha.

Affected by the falling price and the pressure on inventory, some ethylene oxide manufacturers consider reducing the load. Based on the current external price, ethylene oxide is currently losing about 300 yuan. The 650000 ton ethylene glycol unit of Zhenhai Refining and Chemical Co., Ltd. was shut down for maintenance due to failure in the evening of 20 and is expected to restart next Monday.

Downstream monomer manufacturers follow up, manufacturers’ spot inventory pressure is large, traders are under pressure to ship, insiders are in a strong wait-and-see mood, the overall follow-up is limited, and the increase in demand is weak. There is no obvious good news to boost the market.

Forecast: EO has fallen to the low point in two years. Although the demand side is constrained, there is little downside space left, and it is expected to run at a low and weak level.