Downturn Alert shows prices keep falling

D'turn 20May11.pngIt is now 4 weeks since the blog launched its IeC Downturn Alert. Since then, as the chart shows (based on ICIS pricing reports):

• Brent (blue dotted line) is down 11%
• Naphtha (red) is down 13% in Europe
• Benzene (green) is down 9% in Europe
• HDPE export (purple) is down 7% in the USG
• PTA import (red) is down 9% in China

These are serious price declines. They support the blog’s fears that buyers have now retreated to the sidelines.

Downturn Alert was introduced to provide chemical companies of an early warning of a slowdown, after the euphoria of Q1′s excellent results.

Of course, prices may still rally. But for the moment, the Alert is suggesting we may now be at the start of the downturn that has always followed previous periods of high oil prices.

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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