The conflict between Russia and Ukraine is the main reason, and the oil price has reached an all-time high.
On March 2, the spot price of Brent crude oil exceeded US $117 / barrel, and the spot price of WTI crude oil exceeded US $110 / barrel. The current round of high crude oil prices is directly due to the Russian Ukrainian war and the economic sanctions imposed by the United States and Europe on Russia, resulting in widespread concern in the global market about the interruption of crude oil supply. We expect oil prices to remain high in the short term.
Oil, gas and oil service sectors may benefit.
The rise of crude oil price drives the increase of capital expenditure of oil and gas companies, and the increase of mining and exploration projects leads to the increase of profits of oil service enterprises, which may benefit the oil and gas oil service sector. At present, we have observed that international oil and gas giants ExxonMobil, BP and shell have increased their oil and gas capital expenditure in 2022 by 27% – 45%, 9% – 17% and 17% – 37% respectively.
The impact on chemical enterprises is complex.
At the initial stage of oil price rise, the price transmission of chemical enterprises was smooth and the profit increased; However, high oil prices will compress the profit margin of enterprises. In addition, the price fluctuation of refined oil and different chemicals is different due to the different pricing rules of government guided prices and the difference of correlation.
Alternative routes deserve attention.
High oil prices support the high price of chemicals. Modern coal chemical enterprises may benefit significantly from the government’s supervision of coal prices, the implementation of raw material energy consumption policies, and enterprises with light hydrocarbon resources such as ethane.
Investment advice
Oil and gas capital expenditure increases under high oil prices. It is suggested to pay attention to oil, gas and oil service sectors, such as China Oilfield Services Limited(601808) , Petrochina Company Limited(601857) ; Coal head or light hydrocarbon route has comparative advantages, so it is suggested to pay attention to Ningxia Baofeng Energy Group Co.Ltd(600989) , satellite chemistry; Refining and chemical integration enterprises make good profits under certain oil prices. It is suggested to pay attention to Hengli Petrochemical Co.Ltd(600346) , Rongsheng Petro Chemical Co.Ltd(002493) .
Risk tips
Oil prices fluctuated sharply; The expansion of the war situation; The uncertainty of demand recovery has increased.
