By John Richardson I BELIEVE that China’s environmental crackdown will continue to disrupt petrochemicals and polymers markets for the next few years. This is not a temporary phenomenon that will largely go away with the end of the September 2017-March 2018 campaign to minimise air pollution in 28 northern cities. Further waves of environmental inspections […]
Asian Chemical Connections
China’s Polypropylene Market: The Right Questions You Simply Must Ask
By John Richardson On the surface, the above chart represents very good news for exporters of polypropylene (PP) to China. As you can see, our base case sees import volumes creeping up from around 3.9m tonnes in 2018 to 4.2m tonnes in 2025. But this chart should be merely a starting point for a much […]
China Govt Policy To Shape Petchems Demand, Pricing In 2018
By John Richardson NAPHTHA feedstock costs are on the way up, which is of course the result of higher crude prices. So far this year, the naphtha cost for Asian steam cracker operators has averaged $479/tonne CFR China. But our forecast for November 2017-March 2018 is $541/tonne CFR China. This might turn out be an […]
Measuring Crude Prices And Asian Petchems Profitability
By John Richardson YESTERDAY I posted this slide on LinkedIn, in response to a lot of concern amongst the more than 150 or so delegates at the 5th ICIS Asian Polyolefins Conference in Bangkok about the impact of rising crude prices on profitability. The chart shows spreads between naphtha costs, CFR China injection grade HDPE […]
Global Economy Is Less Able To Withstand A New Oil Price Shock
By John Richardson HISTORY has a tendency to move very slowly, inching forward incrementally, and then all of a sudden a flurry of events over an incredibly short space of time can change everything. This is where we are today. Oil prices had been creeping up long before the 4 November launch of the anti-corruption […]
Asian Polyethylene Producers: What You Must Do Now $70 Crude Is More Likely
By John Richardson THE facts on the ground in global crude markets have shifted even further in just two days. Now it seems more likely that oil prices will rise to $70 a barrel or above in Q1 of next year, possibly even earlier. What has changed are the ramifications of Saudi Arabia’s anti-corruption campaign. […]
Crude Oil Prices In 2018: Impact On Naphtha-Based Polyethylene
By John Richardson I WILL explain the full significance of the above charts for the Asian and global polyethylene (PE) industries later on this is post. In short here, though, a great deal hinges on next year’s oil prices, with the possibility that there is more momentum left in today’s rally. And of course […]
Benefits, Risks Of Petronas/Aramco Deals Serving As Template
By John Richardson THE PETRONAS and Saudi Aramco joint ventures in the RAPID refining-to-petrochemicals project in Malaysia may serve as a template for further “win/win deals”. Whilst these deals will substantially benefit the companies and countries involved, there are broader risks that I’ll discuss at the end of this blog post. Back in February, Aramco […]
China To Now Raise Ethylene Capacity By 84% As Self-Sufficiency Drive Accelerates
By John Richardson SINCE my last update on 18 September, our ICIS China team have discovered a further 2.4m tonnes/year of ethylene capacity being planned in China via the steam cracker process (see the updated table above, with the changes from September indicated in red). There will also of course be more propylene via steam […]
Peak Oil Demand Opportunities For Petchems Are Being Over-Hyped
By John Richardson THERE is a lot of excitement about new petrochemicals feedstock opportunities resulting from the approaching end of the road for the internal combustion engine, the rise of the electricity battery car and the related arrival of Peak Oil Demand. Here is some of the logic which supports the notion that the demise […]