Weak gasoline creates benzene opportunity

Benzene markets have become increasingly volatile over the past few years. This is because there are now no major sources available of on-purpose supply, to balance demand.

My speech at our Aromatics Conference in Berlin last week highlighted the changes that had taken place. Over the past 2 years, benzene spreads versus naphtha had fluctuated between minus $100/t and plus $400/t. Whereas historically, spreads had remained in an $80 – $200/t range, as on-purpose hydrodealkylation units (HDA) had supplied up to 20% of demand, and been able to balance the market.

The YouTube interview with ICIS’s Elaine Burridge highlights the key points, and the problems being caused for styrene markets by current tight supply conditions. It argues that the changes underway in gasoline markets offer consumers the chance to achieve a new balance, based on potentially distressed feedstock availability.

About Paul Hodges

Paul Hodges is Chairman of International eChem, trusted commercial advisers to the global chemical industry. Paul is also an invited member of the World Economic Forum’s Global Agenda Council. The aim of this blog is to share ideas about the influences that may shape the chemical industry over the next 12 – 18 months. It will try to look behind today’s headlines, to understand what may happen next in important issues such as oil prices, economic growth and the environment. We may also have some fun, investigating a few of the more offbeat events that take place from time to time. Please do join me and share your thoughts. Between us, we will hopefully develop useful insights into the key factors that will drive the industry's future performance.

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