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LyondellBasell files for bankruptcy

LyondellBasell has become the largest-ever chemical company bankruptcy, just 12 months after its formation. Its US operations (Lyondell Chemical Co), and Basell Germany Holdings GmbH, filed for Chapter 11 protection in New York tonight. The company expects its other non-US operating entities to continue to function independently of the Chapter 11 process. The blog is […]

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US auto sales at 1992 levels

December was another bad month for US auto sales, with volumes down 36% versus 2007. Total 2008 sales of 13.2 million were the lowest since 1992, when the economy bottomed in the 1990-4 recession. As the chart shows, sales volumes dropped continuously during 2008. They were down 10% in Q1, and then Chrysler and Ford’s […]

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The CEO’s survival guide

The past few weeks have not been good for the chemical industry, with 4 major companies suffering significant problems: BASF warned that “customer demand in key markets has declined significantly” since October, and have temporarily shutdown 80 plants worldwide, whilst reducing production at another 100 plants. Dow suffered a major reverse with the last minute […]

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Global manufacturing sinks

Manufacturing output is contracting around the world. JP Morgan’s global index sank 15% in December, and they expect “an intense contraction phase” to continue “for some months to come”. The G7 and BRIC countries are all seeing a decline, as Nouriel Roubini notes: • The US ISM manufacturing index hit a record low of 32.2 […]

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US house prices continue to fall

Q4 was never going to be good for US housing markets. The financial crash of September/October not only terrified potential buyers, but also meant they found it increasingly difficult to secure loans. As the chart shows, this lethal combination hit house prices hard. The latest S&P/Case-Shiller figures show prices down 24% in October from the […]

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The blog in 2008

The blog is now 18 months old. It has a truly global readership, and as shown in the above map, is now read in 1244 cities and 89 countries. Its aim has always been to identify ‘the influences that may shape the chemical industry over the next 12 – 18 months’, and to ‘develop useful […]

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LyondellBasell considers bankruptcy

2008 has not ended well for the chemical industry. First there was the collapse in demand, as the various value chains destocked in response to slowing consumer demand and lower oil prices. Then INEOS, the world’s 3rd largest chemical company, had to seek covenant waivers from its lenders. Now, according to the Wall Street Journal, […]

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Kuwait “scraps” K-Dow JV

2008 has not been a good year for M&A in the chemical sector. First, there was the collapse of Hexion’s Huntsman acquisition. Today, the Kuwait government has signalled its intention to “scrap” its $17.4bn deal with Dow to form K-Dow. This is a quite extraordinary decision by a major Middle East government, especially as it […]

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The impact of banking crises

The blog has been searching the websites of the major central banks, such as the IMF, World Bank, Federal Reserve and Bank of England, for research on the history of credit crises. Several readers, including Paul Noble of Parsons Brinckerhoff, have also kindly forwarded helpful studies. The most comprehensive study that it has found analysed […]

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Oil hits $34/bbl

The blog’s oil price forecasts have had a stellar record this year. Last month, with its $70/bbl forecast having been realised, the blog continued to worry about downside risk: “If refiners are forced to cut runs for December, then it would be hard for OPEC to cut its own production quickly enough to compensate. In […]

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