03 September 2010 18:14 [Source: ICIS news]
LONDON (ICIS)--EU and ?xml:namespace>
The EU sanctions do not specifically apply to methanol, making the purchase of Iranian material completely legal for European companies.
Nevertheless, fewer and fewer banks are willing to offer credit lines for the purchase of Iranian products, making it difficult for companies to proceed with payments.
“It’s not really the consumers who don’t want to buy it, it’s the banks that are cautious. They’re starting to take the American view more. The
For the time being, however, the effect on the European market has been marginal at best, with most sources agreeing the situation has only partially contributed to rising European spot prices, if at all.
Yet many sources said that it would soon become all but impossible to buy Iranian methanol in
If that were to occur, the market would be faced with a significant shortfall in supply, with Iranian nameplate capacity totalling more than 5m tonnes/year.
Furthermore, this would come at a time when at least two plants are shut down for maintenance, namely the 1.15m tonne/year Atlantic Methanol Production Co (AMPCO) plant on
To complicate matters, there are reports that
“This Iranian situation could become a big problem in [the fourth quarter],” said a trader, whose warnings were echoed by several others.
Some players were more optimistic, however, and said the situation would be rectified before prices rose to prohibitively high levels.
“They will somehow continue to sell into
“Sometimes you see Indian material, which is just ridiculous – there is no methanol production in
Others said the sanctions could be eased if global industries begin to suffer, noting that more than just the methanol market is affected.
“If the price of crude starts to go up, the
($1 = €0.78)
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