Tag Archives | crude oil

Plastics demand is peaking as circular economy arrives

The Stone Age didn’t end because we ran out of stones.  Similarly, coal is being left in the ground because we no longer need it any more.  And the same is happening to oil, as Saudi Arabia recognised last year in its Vision 2030: “Within 20 years, we will be an economy that doesn’t depend mainly […]

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The world of $100/bbl oil is unlikely to return

Chemical markets are continuing to signal that the world faces major economic challenges in 2015.  The chart above highlights developments since August, when I first forecast that oil prices would see major falls, and that the value of US$ would see “a strong move upwards“: Benzene, always my favourite indicator for industrial output, has suffered worst, down 56% (green) Brent […]

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Why did nobody else forecast that the oil price would collapse?

Brent oil prices closed at $104.71/bbl on Friday 15 August.  On the following Monday morning, I published the first post in my Great Unwinding series, arguing that: “The Great Unwinding of the failed stimulus policies since 2008 has now begun…oil markets are starting to follow cotton and other commodities in refocusing on the fundamentals of supply and […]

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Shell, Bayer, Tullow to speak at World Aromatics conference

Next month’s World Aromatics and Derivatives Conference in Brussels has a range of top-name speakers discussing key issues for the markets. Co-organised as always with ICIS, it features: Shell:  Global strategy manager Herbert Le Lorrain will present Shell’s new scenarios for the future, ‘Mountains and Oceans’ Bayer MaterialScience: New procurement head Christian Buhse will provide his first impressions […]

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Supply shortages drive olefin market profitability

The above chart would have seemed unbelievable at any time in the past 30 years. It shows the performance of propylene and butadiene relative to ethylene. Not because it shows butadiene prices racing ahead relative to ethylene (green line). This happens routinely during a downturn, as tyre demand is more robust than for polymers. If […]

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‘Peak oil’ a theory, not a statement of fact

Oil supply is critical to today’s global economy. Now a new book by oil expert Daniel Yergin, author of ‘The Prize’, suggests that the outlook may be more promising than most believe. Pessimists such as Marion King Hubbert have argued that the world is running out of oil. Hubbert, for example, gave his name to […]

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A tale of two outlooks – part 2

In an early blog last July, I marvelled at the contrast between the then upbeat nature of financial markets, and the gloom apparent elsewhere. I suggested that these two views of life couldn’t ‘continue to exist alongside each other for ever’, and suggested that whatever scenario came out on top would ‘have major implications for […]

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$100 crude – US manufacturing close to recession

Oil prices touched $100/bbl today, a new record in nominal and inflation-adjusted terms. At the same time, the US Institute of Supply Management (ISM) index signalled that the manufacturing sector ‘failed to grow in December’, with ‘industries close to the housing market struggling more than others’. All the ISM’s main indicators were negative, with inventories […]

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5 risks to 2008 budgets

The consensus viewpoint is an easy way of keeping up to speed on a variety of issues outside one’s daily experience. But the signs are that the consensus may be leading to complacency, when it comes to the assumptions being used to finalise 2008 budgets. There are a number of areas where some new thinking […]

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Pricing power – ING’s concerns

Since posting yesterday, oil prices have moved further ahead, with WTI closing at $93.53. I have also had an interesting dialogue with Paul Satchell of ING Bank, one of the leading chemical analysts, who has kindly allowed me to summarise his comments. Paul believes that investors have become ‘dangerously complacent’ about the industry’s ability to […]

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