Tag Archives | ethylene

EU cracker operating rates remain near record lows

An ageing population and record annual levels of oil prices create massive headwinds for Europe’s petrochemical producers.  One means demand growth is much reduced from the SuperCycle.  The other means these lower volumes cost more to produce. What a pity, you might say, that the industry is not part of the financial sector.  Then it […]

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US shale gas expansions highlight lack of demand

One good thing may come out of the current excitement over the US ethylene expansions being discussed on the basis of shale gas developments. Boards may decide to look at seriously at the way yesterday’s ‘demographic dividend’ has now become today’s ‘demographic deficit’.  That would be a major step forward for the US and the […]

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C2 pricing Jan14

Ethylene prices have 96% correlation to oil prices

Companies are about to review their Q1 performance, and re-forecast profit and revenue for the rest of the year.  Most will be disappointed with results so far, as the long-promised economic recovery has again failed to appear. This will be no surprise to blog readers.  But there is another and connected issue for Management Teams to worry […]

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European ethylene production at 1996 low

Nobody was expecting very much from Q4 ethylene production in Europe, as several plants had been taken offline in December due to lack of demand.  And yet it is still possible to be disappointed by the actual outcome as reported by APPE.  As the chart above shows: Q4 production at 4.4MT was the lowest since the […]

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Demand now the key driver for future US petchem profitability

Will the US be able to sell all its planned new petchem volumes?  That is the 3rd topic in the blog’s series about critical areas where we all think we know what’s happening, but may end up being surprised. We all know that the US now has a major feedstock advantage versus Europe, Asia and Latin America due […]

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Ethylene demand weak as eurozone flirts with recession and deflation

So this is as good as it gets in 2013.  That seems to be the sad conclusion from analysis of Q3 operating rate (OR%) data for Europe’s crackers.  Actual Q3 OR% inched up to 81%, which was slightly better than 2012′s 80% rate and 2009′s 79% rate.  But its a very long way from the […]

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Asian ethylene margins soar on China stimulus, plant outages

Volatility is one of the blog’s key themes for the next few years, as the world transitions to slower growth and a more regional economy.  And the chart above from the latest ICIS pricing Asian ethylene margin report highlights this new trend very well: Margins jumped 42% last week to reach $290/t, based on naphtha […]

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High oil prices take European operating rates to record lows

Life doesn’t get any easier for Europe’s olefin producers and the consumers who depend on them.  As the chart shows, based on latest APPE data, operating rates averaged just 78% in H1.  This is almost as bad as H1 2009, when they were 76%.  And it is a long way away from the 90% levels […]

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Lack of demand threatens US ethylene expansions

The above chart paints a depressing picture for anyone thinking it should be easy to make money via a major US ethylene investment based on cheap ethane from shale gas.   It shows 2012 ethylene production (red column) was still below SuperCycle levels, as were volumes for the two major derivatives – polyethylene (blue) and PVC (green).  It highlights how lack of demand […]

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Sinopec Jul12.png

Sinopec focuses on political and social targets

Sinopec is China’s main company in refining and chemical markets. Although it is listed on world stock markets, the government remains its largest shareholder with a 76% stake. As such, it follows government priorities rather than western commercial logic. The chart above, from the blog’s major new study of the company, highlights some of the […]

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