White Oil Recent Commodity Market Intelligence Report

I. Price Dynamics
1. National Mainstream Market Average Price
- On May 22, 2026, the national average mainstream price for light white oil stood at RMB 9,234.64 per metric ton, down 0.01% from the previous day.
- From May 14 to 22, prices fluctuated narrowly between RMB 9,201.23 and RMB 9,235.77 per metric ton, reflecting overall stable, range-bound movement.

2. Regional Market Prices
- South China Market: On May 19, spot transaction averages for W40, W60, and W80 light white oil were all RMB 9,800 per metric ton. Prices remained stable, supported by cost fundamentals and constrained by inventory pressure.
- East China Market: On May 25, Nanjing Runsheng Petrochemical quoted RMB 8,800 per metric ton for industrial white oil (density 0.84, premium grade), unchanged month-on-month.
- North China Market: On May 24, Shandong Hanyue Chemical quoted RMB 7,800 per metric ton for No. 15 industrial white oil and RMB 7,700 per metric ton for No. 26 white oil (produced by CNOOC), with prices continuing to trade at relatively low levels.

3. Segment-Specific Prices
- High-Viscosity White Oil: Wuhan Hengjiu Chemical quoted RMB 8,350 per metric ton for D80 white oil (distillation range: 210–228°C) and RMB 8,950 per metric ton for D40 white oil (distillation range: 165–191°C), indicating pronounced price differentiation.
- Specialty White Oil: Shandong Hongyang Chemical quoted RMB 8,600 per metric ton for D60 white oil and RMB 7,500 per metric ton for No. 36 ultra-white oil, reflecting resilient demand in high-end applications.

II. Market Drivers
1. Supply Side
- Capacity Expansion: CNOOC Huizhou Petrochemical has doubled its drilling fluid white oil production capacity through technological upgrades, alleviating upstream exploration and development demand pressures. However, overall industrial white oil capacity utilization remains constrained by feedstock compatibility limitations.
- Regional Disparities: Northwest regions (e.g., Shenhua Ningxia Coal and Zhidan Jieneng) benefit from lower raw material costs, resulting in generally lower white oil prices than those in East and South China—creating inter-regional arbitrage opportunities.

2. Demand Side
- Industrial Applications: Demand from downstream sectors—including lubricants and metalworking fluids—remains stable. Yet, amid a global economic slowdown, procurement strategies have turned more cautious, with buyers adopting just-in-time replenishment.
- High-End Applications: Demand for cosmetic-grade and food-grade white oil continues to grow steadily, underpinning pricing resilience for high-value-added products—for example, clear premiums observed for D40 and D80 grades.

3. Cost and Policy Factors
- Crude Oil Volatility: International crude oil prices remain elevated and volatile, providing a floor for white oil production costs. Refineries partially offset cost pressures through process optimization (e.g., blending tail oils).
- Tariff Adjustments: The State Council has suspended tariff concessions on 134 tariff items imported from Taiwan’s region, covering certain chemical products. While direct import impacts on white oil are limited, such measures influence market sentiment via psychological expectations.

III. Analysis & Outlook
1. Short-Term Trends
- Price Trend: Slightly Weak but Stable — Industrial white oil prices are likely to continue narrow-range fluctuations amid seasonal demand softness and inventory accumulation. Price declines in South and East China markets will be modest due to stronger cost support.
- Structural Divergence: High-viscosity and specialty white oils exhibit greater price resilience, backed by essential downstream demand, leading to a bifurcated market: “high-end firm, low-end pressured.”

2. Medium-to-Long-Term Outlook
- Capacity Release Pressure: As newly added capacities—including those from CNOOC Huizhou Petrochemical—gradually reach full operation, oversupply risks for industrial white oil may rise, potentially exerting downward pressure on prices. Nevertheless, supply-demand gaps persist for high-end products.
- Policy & Environmental Drivers: Stricter environmental standards will accelerate the exit of outdated, low-end production capacity, fostering industry transformation toward high-end, differentiated development. Enterprises with technological advantages are poised to expand their market share.

IV. Forecast
1. Price Range
- In June 2026, the national average mainstream price for light white oil is projected to range between RMB 9,100 and RMB 9,300 per metric ton. Premium products in South and East China markets may exceed RMB 9,800 per metric ton.

2. Market Opportunities
- High-End Product Development: Companies are advised to intensify R&D investment in cosmetic-grade and food-grade white oil to capture incremental demand from emerging application segments.
- Regional Arbitrage Strategy: Optimize logistics costs in cross-regional distribution—from Northwest to East and South China—to enhance profit margins through regional price differentials.

3. Risk Alerts
- Sharp Crude Oil Price Decline: A significant drop in international crude oil prices would weaken cost support for white oil, potentially triggering broad-based price corrections.
- Unexpected Demand Contraction: Prolonged low operating rates in downstream industries—such as textiles and chemical fibers—could further depress industrial white oil demand.