The conflict between Russia and Ukraine has escalated, the oil price has reached a new high, and we continue to be optimistic about the prosperity of the petrochemical industry. On February 24 local time, Russian President Vladimir Putin made a speech and decided to carry out special military operations in Donbas. The conflict between Russia and Ukraine further escalated. The intraday price of Brent crude oil futures broke through the $100 / barrel mark, a new high since September 2014. After that, the oil price fell somewhat. Global crude oil demand continues to recover, the decline of OPEC effective surplus capacity and the shortage of global oil and gas capital expenditure still limit the repair of short-term crude oil supply. The follow-up development trend of the recent conflict between Russia and Ukraine has a great impact on the short-term oil price trend. Russia is a major exporter of oil and gas. Europe has a high dependence on Russia’s energy supply. The escalation of the conflict between Russia and Ukraine may exacerbate the tension of crude oil supply in the short term. The growth rate of capital expenditure plans of medium and long-term overseas oil companies is low. To sum up, the market is increasingly sensitive to geopolitical risks. As a basic energy, important chemical raw materials and important strategic reserves, the value of crude oil is bound to rise again and continue to be optimistic about the petrochemical industry.
The conflict between Russia and Ukraine affects the global supply of agricultural and chemical products, and the higher product prices benefit China’s chemical fertilizer enterprises. Russia and Ukraine are the world’s major trading countries in wheat, corn and sunflower oil. At the same time, Ukraine’s arable land ranks first in Europe and is known as the “European granary”. Due to the escalation of the situation in Russia and Ukraine, there is obvious uncertainty in the planting and production of local grain enterprises in Ukraine. At the same time, as the United States, the United Kingdom and the European Union have expressed that they will impose sanctions on Russia, the subsequent pressure on Russian commodity exports represented by Shenzhen Agricultural Products Group Co.Ltd(000061) will increase significantly, which will further push up international grain prices. In addition, Russia is also one of the three largest exporters of chemical fertilizers in the world and occupies an important position in the international chemical fertilizer supply chain. Russia ranks first in nitrogen fertilizer exports, second in potassium fertilizer exports and third in phosphate fertilizer exports. Similarly, with the sanctions imposed by European and American countries on Russia, there will be an obvious shortage of global fertilizer supply, which will raise the global fertilizer price, which may be good for Chinese fertilizer enterprises.
Weekly rise and fall of sectors: in the past five trading days, most of the sectors in Shanghai and Shenzhen stock markets showed a decline. This week, the Shanghai stock index fell by 1.13%, the Shenzhen Component Index fell by 0.35%, the Shanghai and Shenzhen 300 index fell by 1.67%, and the gem index rose by 1.03%. CITIC basic chemical sector rose 2.4%, ranking fifth in all sectors. In the past five trading days, most of the sub sectors of the chemical industry showed an upward trend. The top five sub sectors of the rise and fall were phosphate fertilizer and phosphate chemical (+ 10.0%), civil explosives (+ 10.0%), carbon fiber (+ 6.1%), lithium chemicals (+ 5.9%) and potassium fertilizer (+ 5.6%).
Rise and fall of individual stocks: in the past five trading days, the top gainers in the basic chemical sector are: Baoding Lucky Innovative Materials Co.Ltd(300446) (+ 47.41%), Hubei Forbon Technology Co.Ltd(300387) (+ 36.85%), Sichuan Yahua Industrial Group Co.Ltd(002497) (+ 29.63%), Guofeng new material (+ 20.88%), Sanwei Holding Group Co.Ltd(603033) (+ 20.40%).
Investment suggestions: (1) the upstream oil and gas sector is suggested to pay attention to Petrochina Company Limited(601857) , China Petroleum & Chemical Corporation(600028) , CNOOC, Enn Natural Gas Co.Ltd(600803) and other oil service targets. (2) White horse, the leader of undervalued chemical industry: it is suggested to pay attention to ① three chemical white horses: Wanhua Chemical Group Co.Ltd(600309) , Shandong Hualu-Hengsheng Chemical Co.Ltd(600426) , Jiangsu Yangnong Chemical Co.Ltd(600486) ; ② Private refining and chemical fiber sector: Hengli Petrochemical Co.Ltd(600346) , Rongsheng Petro Chemical Co.Ltd(002493) , Jiangsu Eastern Shenghong Co.Ltd(000301) , Hengyi Petrochemical Co.Ltd(000703) , Tongkun Group Co.Ltd(601233) , Xinfengming Group Co.Ltd(603225) ; ③ Light hydrocarbon cracking sector: Satellite chemistry, Oriental Energy Co.Ltd(002221) ; ④ Coal to olefin: Ningxia Baofeng Energy Group Co.Ltd(600989) . (3) Plate: sector sector of new material sector: suggestions and concerns: sector sector sector: sector sector of sector: sector of sector: sector of sector: sector of sector: sector of sector: the following concerns: ① semiconductor materials: the Crystal Clear Electronic Material Co.Ltd(300655) \\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\; ② Wind power materials: carbon fiber, polyether amine, matrix resin, interlayer materials, structural adhesive and other related enterprises; ③ Lithium battery materials: electrolyte, lithium battery diaphragm, phosphorus chemical industry, fluorine chemical industry and other related enterprises; ④ Photovoltaic materials: upstream silicon materials, EVA, soda ash and other related enterprises; ⑤ OLED industry chain: Valiant Co.Ltd(002643) , Xi’An Manareco New Materials Co.Ltd(688550) , Jilin Oled Material Tech Co.Ltd(688378) , Puyang Huicheng Electronic Material Co.Ltd(300481) . (4) Traditional cycle sector: it is suggested to pay attention to relevant targets in the fields of pesticides, coal chemical industry, urea, dyes, vitamins, chlor alkali, etc.
Risk analysis: the risk of rapid decline and high oil price; Downstream demand is less than expected risk.
