Taking stock of the major events occurring in the liquefied gas market in 2023, there are two things that directly affect the fundamentals of supply and demand: first, the safety accident of Ningxia restaurant; Ii. Alkylate oil is subject to consumption tax. These two major events affect the civil and olefin carbon 4 markets respectively.

Safety accidents directly affect the demand for civil gas, legal compliance into the field, non-compliance does not meet the requirements of the ban, to the regular units to give up the market; However, it also has a negative impact on civilian terminal gas use.

There have been many reports and analyses of the dramatic changes in the market caused by the consumption tax on alkylate oil and the sharp increase in costs. Five months have passed since the implementation of the policy, and we will take a look at the specific impact on the carbon four market through data.

Through the change in the demand for C4 of olefin in alkylation devices, it can be seen that the demand is relatively stable in the first one or two months before the introduction of relevant policies. The small holiday in May was the peak season for oil demand, which should have been a relatively high level for the construction of alkylation devices, but the consumption tax was levied in the late middle and late, and some enterprises reduced the burden or stopped work to avoid risks, resulting in a decline in the alkylation operating rate and demand, and the utilization rate of alkylation capacity fell nearly 10 percentage points in a short period of time. After nearly half a month of turmoil, the alkylated oil and olefin C4 market once again found a new balance point: the price of olefin C4 has been significantly reduced.

In May, China’s olefin carbon 4 price fell 11.76%, continued to decline 8.84% in June, and rebounded in August; Alkylation profits were higher in the raw material gas slump stage, but profits gradually declined with the beginning of tax in the later period, and inverted in August, after a long-term loss. The rebound of raw material carbon 4 is due to the active stocking of low price alkylation devices. This downstream includes alkylation units as well as others. Affected by the restrictive policy side, the price of carbon four of olefin has fallen to a low position, not only the income of the alkylation device, but also the dividend of the olefin isomerization device, some of the halted enterprises have resumed work or have resumed work plans, and the demand side has gradually improved.

The olefin carbon 4 market has not returned to calm due to the new balance, and the inspection from time to time will also affect the trend in stages, and the future olefin carbon 4 will still seek new development in the turbulence.