Tag Archives | Polyethylene

US GDP Jul11.png

US GDP still below 2007 levels

On Friday, the US government announced that GDP grew just 0.8% in H1. This, of course, was far below the US Federal Reserve’s confident estimate of 3.5-4% for 2011, given only 4 months ago in March. We are indeed in a New Normal. But the consensus simply refuses to recognise the impact on demand of […]

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Petchem markets stabilise

Petchem markets have moved into an interesting phase. Optimists will point to the recovery in crude oil and financial markets, plus higher prices for naphtha and benzene. They will see these as signs that we are just in the middle of a typical correction. And they will hope for further price increases over the summer. […]

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Brent Jul11.png

Oil markets surge on QE3 hopes

“Will he, won’t he?” That was the only question in oil markets last week. On Wednesday, US Fed chairman Ben Bernanke seemed to suggest that QE3 might arrive, to follow on from his QE2 ‘LifeBoat’ for the economy. As the chart shows, oil prices leapt $3/bbl within 2 hours as he spoke. But then Bernanke’s […]

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Investment banks push oil prices higher

The start of a new half-year usually provides an excuse for the investment banks to publish bullish notes on oil markets. We discuss their role in Chapter 3 of Boom, Gloom and the New Normal, to be published later this month. Thus Goldman Sachs last week suggested oil markets will become “critically tight” in 2012, […]

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Downturn Alert shows markets weakened in Q2

The last week of a half-year period often sees greater volatility in financial markets, as players rush to position themselves for client reporting. This was most obvious in stock markets, with the US S&P 500 Index (pink dotted line) staging a 5% rally during the week. Brent crude oil (blue dash) eventually ended unchanged versus […]

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Downturn Alert shows markets still weakening

The IeC Downturn Alert launched on 2 May. Later that day, the US S&P 500 – the world’s most important stock index – hit a post-Crisis high of 1370. Last Friday, it closed down 7% at 1268 (purple dotted line above). Many expect this to be just a minor correction, and still believe a new […]

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China PE Jun11.png

China’s PE market slows further

China’s polyethylene (PE) demand in Q1 was down 1.6%. Now the blog’s analysis suggests Jan-May demand was down 4% versus 2010 at 7.1MT. As the chart shows, based on data from Global Trade Information Services and ICIS: • Domestic production (blue) was up 5.6% to 4.3MT • Imports (red) were down 12% at 3MT • […]

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High stocks lead buyers to hold back purchases

Buyers’ behaviour has changed completely since the IeC Downturn Alert launched 7 weeks ago. ICIS news reported Friday a large polypropylene consumer commenting: “I am not buying a lot, just one or two trucks at a time. I kept a high stock level when prices were going up, so now I am using that up. […]

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China PE imports Jun11.png

China’s PE cutbacks suggest economy is slowing

China’s stimulus programmes have been a major support for the global chemical industry over the past 2 years. In polyethylene (PE), for example, its total demand grew an astonishing 53% between 2008-10, from 11.7MT to 17.9MT. But now, China’s rapid demand growth seems to have slowed. According to Thomson Reuters, China’s PE consumption actually fell […]

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Crude stabilises as Goldman suggests $130/bbl target

Week 5 of the IeC Downturn Alert saw more stability in the markets. This was largely due to the efforts of the major investment banks. JP Morgan, Goldman Sachs and Morgan Stanley all issued ‘buy’ notes on crude oil, suggesting prices would soon return to $130/bbl, whilst Barclays said its current $102/bbl forecast was “conservative”. […]

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