China Galaxy Securities: The rise in oil prices in August is expected to be in the range of 80-95 US dollars/barrel in September

The Zhitong Finance App learned that China Galaxy Securities released a research report saying that due to continued geographical disturbances, the price of Brent crude oil is expected to fluctuate widely in the range of 80-95 US dollars/barrel in September 2026. It is recommended to follow up closely on the progress of the US-Iran negotiations, the navigation situation of key maritime routes, and the operation of oil production facilities in the Gulf region. The bank believes that in anticipation of the 10th peak season for gold, nine, and silver, it is recommended to focus on the polyester filament sector due to downstream demand for storage and replenishment. Furthermore, it is recommended to continue to pay attention to growth targets.

The main views of China Galaxy Securities are as follows:

The center of gravity of oil prices rose in August

The average monthly prices of Brent and WTI in August were 88.1 and 82.4 US dollars/barrel, respectively, up 4.9% and 4.6% from month to month, respectively. On the supply side, the geographical situation in the Middle East remains tense. On August 29, Iran's Deputy Foreign Minister said that Iran and Oman have reached an understanding on arrangements for ships to pass through the Strait of Hormuz, but the Strait of Hormuz will not be reopened until the US fulfills its promise. According to data from Shipwatch, the number of liquid bulk carriers flowing through the Strait of Hormuz is still at a low level. On the demand side, the operating performance of refineries in major regions of the world is divided. On the one hand, at present, the weekly operating rates of China's main refineries, large-scale independent refineries, and Shandong refineries are 73.2%, 88.6%, and 58.4%, respectively, up 3.0, 23.9, and 7.2 percentage points from the week at the end of July. Compared with the same period last year, it is expected that there is still room for repair in the operating rates of main and large independent refineries. On the other hand, for the week ending August 21, the operating rate of US refineries was 97.4%, up 0.9 percentage points from the week at the end of July, and operating at a high level. On the inventory side, US commercial crude oil inventories for the week ended August 21 were 428.91 million barrels, an increase of 21.92 million barrels over the week at the end of July. The bank believes that there are repeated expectations of a geopolitical conflict. It is expected that the short-term Brent crude oil price will run in a wide range of 80-95 US dollars/barrel until normal traffic resumes in Hormuz. It is recommended to follow up closely on the progress of the US-Iran negotiations, the navigation situation of key maritime routes, and the operation of oil production facilities in the Gulf region.

In January-July, China's apparent demand for crude oil declined, down 8.9% year on year

In January-July, China processed 397 million tons of crude oil, down 6.5% year on year; crude oil production was 128 million tons, up 0.9% year on year; crude oil imports were 283 million tons, down 13.2% year on year; apparent crude oil consumption was 409 million tons, down 8.9% year on year; external dependence was 69.2%, down 3.5 percentage points year on year.

In January-July, China's apparent demand for natural gas fell slightly, down 0.8% year on year

In January-July, China's natural gas production was 154.3 billion square meters, up 1.2% year on year; import volume was 94.1 billion square meters, down 2.6% year on year; apparent consumption was 243.3 billion square meters, down 0.8% year on year; external dependence was 38.7%, down narrow year on year.

In January-July, China's apparent demand for refined oil products declined, down 7.2% year on year

In January-July, China's refined oil production was 219 million tons, down 7.2% year on year; refined oil exports were 0.28 million tons, down 13.1% year on year; apparent consumption of refined oil products was 210 million tons, down 7.2% year on year. Among them, the apparent consumption of gasoline, diesel and kerosene changed by -2.5%, -5.5%, and 0.8% year on year, respectively. In July, the situation in the Middle East gradually eased. On the basis of maintaining a stable domestic supply of refined oil products, export controls for refined oil products were moderately relaxed in stages. The export volume of refined oil products rebounded markedly month-on-month during the month, and there is still room for repair over the previous year.

Risk warning: Risk of increased international trade friction, risk of interruption in supply of main raw materials, risk of downstream demand falling short of expectations, risk of project delivery falling short of expectations, etc.