This week, the crude oil market has fluctuated repeatedly, and geopolitical news continues to disturb market expectations. Although crude oil has fallen continuously in the early stage and closed slightly in stages, it has not formed a sustained upward trend guidance, and cost support has fluctuated. As prices continue to decline, traders are cautious and their quotes are continuously decreasing in line with the market trend. Under the stimulation of low prices, some downstream companies have engaged in buying at low prices with a small amount of replenishment operations, but most of them are just small orders for essential needs. There is a lack of willingness to purchase in large quantities, and the overall trading atmosphere in the market is light. The price difference related to aromatic hydrocarbons continues to shrink, while the price difference between PX and mixed xylene, as well as pure benzene toluene, narrows synchronously. Downstream processing profits are squeezed, further suppressing procurement enthusiasm. Under the combined effects of cost disturbance and weak demand, the price center of toluene has significantly shifted downwards.
From November 2 to November 9, 2026, the domestic toluene market as a whole showed a narrow range of fluctuations, with an average market price of 8866.67 yuan/ton at the beginning of the week on November 2 and 7600 yuan/ton on the weekend on November 9. The cumulative weekly decline was 14.29%.
Cost aspect:
The trend of crude oil this week is the core variable of toluene cost, and crude oil first fell and then rebounded slightly during the week, lacking sustained upward momentum overall. The cost boost brought by the temporary rebound of crude oil is limited, making it difficult to hedge against the negative impact of the previous oil price drop. As a refined aromatic hydrocarbon product, toluene has a strong correlation with crude oil. The shift in the center of gravity of crude oil has driven down the expected cost of refining, putting sustained downward pressure on toluene spot prices. Crude oil is affected by the alternation of geopolitical news, with a fast fluctuation rhythm. The market has significant differences in expectations for forward costs, and many businesses mainly engage in short-term operations and dare not stockpile for the long term. The cost side has failed to provide stable support for toluene. As of November 6th, the settlement price of the December contract for WTI crude oil futures in the United States was $90.83 per barrel. The settlement price of Brent crude oil futures for January contract is $98.32 per barrel.
Supply side:
This week, the overall operation of domestic toluene refinery facilities has been stable, with industry production maintaining a medium to high level. There are currently no centralized large-scale maintenance arrangements, and the domestic production of toluene products has remained stable. The external cargo has arrived at the port as planned, and the supply of goods from the main ports in East China is orderly. The port inventory is in a neutral range, and there is no obvious shortage of overall goods. Only partial regional spot prices are temporarily tight, forming a weak support for local quotations, and the regional price difference differentiation is limited, which is not enough to reverse the overall weak market trend. As the market continues to decline, the pressure on refinery shipments is gradually increasing. Some companies are offering discounts to promote transactions, and the supply of circulating goods is sufficient, making it difficult for the supply side to form strong bullish support.
Demand side:
The demand side is the core factor dragging down the toluene market this week, and downstream comprehensive profits continue to be weak. The price difference between the processing of disproportionation and PX units has narrowed, putting pressure on production profits. Downstream units are maintaining normal load operation, and there is a weak willingness to actively stock up; Downstream orders for coatings, solvents, TDI, and other terminal products are not being followed up effectively, and there has been no significant increase in terminal production. Procurement is mainly based on on-demand procurement, with only sporadic dips to replenish positions during the price drop window, and a lack of centralized buying to release orders. The downstream has a low acceptance of high priced goods and generally maintains a wait-and-see attitude. Against the backdrop of weak price difference structure, the buying atmosphere is difficult to fundamentally improve, and the demand side lacks the driving force to continuously drive the market.
PX is one of the main downstream directions of toluene. This week, the price difference between PX and mixed xylene continues to narrow, putting pressure on the processing profits of the equipment and limiting the production enthusiasm of PX enterprises. The device basically maintains its current load operation without obvious plans to increase load. It follows up on the purchase of toluene raw materials as needed, and has a weak willingness to actively increase procurement and stock up in advance. It only replenishes a small amount with production consumption, and has not formed a sustained demand for raw material procurement, which has limited driving effect on toluene.
Market forecast:
The domestic toluene market is likely to maintain a weak and volatile operation in the short term. The cost side of crude oil is affected by the geopolitical situation, with strong volatility and uncertainty, and fluctuating support; There is currently no centralized maintenance plan for the refinery on the supply side, and the pace of port to ship operations is stable. The supply of spot goods remains loose, and there is no significant contraction in the supply side. In terms of demand, it will take some time for downstream processing profits to recover, and the expectation of a rebound in terminal orders is weak. Concentrated buying is difficult to release quickly, and the weak price difference pattern is not likely to change in the short term. Overall, the game between cost disturbance and weak demand will continue, and the upward resistance of toluene is relatively high. The follow-up focus will be on tracking the trend of crude oil prices, changes in port inventories, the commencement of disproportionation and PX units, and the pace of downstream inventory replenishment.
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