A few laugh and a few worry about the increase in oil prices

The State owned Assets Supervision and Administration Commission's price increase for refined oil products has become a fact, but what impact does the price increase for refined oil products have on industries and listed companies related to refined oil products? The most direct beneficiaries of price increases should be refining companies and the two major oil companies, China Petroleum and Sinopec. Refining companies include Shanghai Petrochemical, Sinopec, Yanhua High tech, Maohua Shihua, and China Phoenix in the A-share market. From relevant information, we can see that most of the listed companies in the refining industry related to refined oil products had poor performance in 2005. 80% of the listed companies related to refined oil products had a significant decline in gross profit margin in the first three quarters of 2005, with 8 companies experiencing a year-on-year decline of more than 50%. Their performance was either in deficit or on the brink of deficit, with the largest decline being in Sinopec, which had a negative gross profit margin, resulting in significant losses for the company. The two increases in refined oil prices will greatly increase the gross profit margin of listed companies in the refining industry, and related listed companies are expected to turn losses into profits. However, against the backdrop of the ongoing price difference between domestic and international markets, the rise in crude oil prices may still trigger another price hike. Of course, from the current perspective, it is more important for the government to subsidize vulnerable groups and balance the oil costs of all parties involved.

The logistics and transportation industry is the first to suffer negative impacts due to price increases. The more obvious ones are bus and water transportation companies, followed by taxi companies. At present, in the A-share market, listed companies in the public transportation industry include Beijing Bus, Bus Co., Ltd., Nanjing Zhongbei, Jiangxi Changyun, etc. Water transport companies include Nanjing Water Transport, Changyun Co., Ltd., Ningbo Shipping, COSCO Shipping, etc.

The retail price (middle price) of aviation fuel for domestic routes will increase from the original 5520 yuan per ton to 6020 yuan per ton, with a growth rate of 9.1%. The negative impact of this price adjustment on the performance of various airlines is also quite evident, with Hainan Airlines, China Southern Airlines, Shanghai Airlines, Eastern Airlines, and Air China ranking in order of severity. If the international crude oil price continues to remain above $65 per barrel, domestic aviation oil prices may still be further raised.

The increase in refined oil prices has not had a significant impact on the chemical fiber industry. The main raw materials for chemical fiber enterprises such as Nanjing Chemical Fiber, Jilin Chemical Fiber, and Xinxiang Chemical Fiber come from cotton, and are not significantly affected by oil prices. Enterprises such as Yizheng Chemical Fiber and Sanfangxiang mainly produce polyester products, and their raw materials come from naphtha in finished oil. Unlike gasoline and diesel, the price of domestic naphtha is determined by the market and is not affected by this price adjustment.