03 October 2010 16:46 [Source: ICIS news]
BUDAPEST (ICIS)--The chemical industry’s strong recovery this year has been driven by a lack of supply rather than sound demand fundamentals, a consultant said on Sunday.
Speaking on the sidelines of the 44th annual meeting of the European Petrochemical Association (EPCA) in ?xml:namespace>
Hodges, who also writes a blog for ICIS, claimed that the industry in
The rallying oil price, Hodges said, has more to do with financial markets than a fundamental improvement in demand.
“The Federal Reserve says it is getting worried about the
He added: “It’s got nothing to do with the supply of crude – we’ve got almost the highest stocks we’ve ever seen.”
Scenario planning will be vital for chemical companies hoping to prepare well for the uncertainties of 2011, he said.
“A phrase from Warren Buffet comes to mind, which says that over the course of a lifetime you may see extraordinary or even bizarre things happening in financial markets. We’ve got to accept that we’re living through one of those times.”
He added: “We’re back to scenario planning. We’ve got to ask ourselves what we can do to insulate ourselves from what is happening. You’ve got to be able to optimise when things are going well and mitigate when things aren’t going so well. Planning is the key.”
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