By John Richardson RIGHT now, of course, oil prices are on the up again because of disruptions to Libyan production and confidence that OPEC will extend its production cuts. Libya might of course be a temporary factor, and it depends how you define what OPEC has actually already done, and what it might do in […]
Asian Chemical Connections
Brexit Article 50: Into The Unknown As Political Risks Increase
By John Richardson BRITAIN enters the unknown today with the triggering of Article 50, the beginning of the formal procedure for quitting the EU. The clock will start ticking on two years of negotiations when British ambassador to the EU, Sir Tim Barrow, delivers a letter already signed by British Prime Minister Theresa May to […]
New Petchems Business Model Based On Trading Blocs
By John Richardson THE above chart should give every analyst who thinks low feedstock costs are by themselves guarantee of success in petrochemicals pause for thought: US net polyethylene (PE) exports in 2016 were 5,000 tonnes lower than in 2015, even though one would have expected exports to have been ramped-up last year. Increased exports would have helped […]
Oil Prices Could Fall By 50% On Demand As Well As Supply Realities
By John Richardson THE REAL crude-oil supply story is becoming more commonly understood – hence, the recent declines in pricing. As I discussed in early March, before oil prices started heading south again, supply has been long for a substantial length of time. It is just that speculators chose to view the data in a different way as they […]
The Trump Agenda: Boosting US Growth Will Not Be Straightforward
By John Richardson DURING his election campaign Donald Trump painted an image of an America that had been economically hollowed-out by unfair overseas competition. And in his inauguration speech on 20 January he talked of rusted-out factories scattered like tombstones across the landscape of our nation, and then added: One by one, the factories shuttered […]
“War of Words” On Global Trade To Continue
By John Richardson WE remain in almost entirely uncharted territory despite the confidence of US stock markets. Take as an example the communique released after this weekend’s G20 meeting where traditional language about the importance of open global markets was dropped in order to keep the US happy. The wording of this joint statement was […]
China Commodity SpeculationThreatens Price Correction
By John Richardson A SMOKING gun that points to more market-distorting high levels of speculation in China’s commodity markets? Have “circular trades” have made a comeback, where one commodity is bought merely to speculate in another commodity or even in real estate? Please consider the following evidence: China’s coastal iron ore inventories in early March […]
China Polyolefins: An Outlook For The Rest Of 2017
By John Richardson AS THE chart above shows, China is suffering from a bout a polyolefins indigestion right now as a result of a sharp rise in both imports and domestic production. This helps to explain the recent falls in pricing. This extra supply might have been very easily absorbed if markets had bounced back […]
Shift In Lending Patterns Indicate Slower 2017 China Growth
By John Richardson WE HAVE now seen two months of a very important shift in the pattern of credit growth in China: In January, new local-currency bank loans were Rmb2.13 trillion ($310bn).. This was far above December’s Rmb994bn, but there is always a big seasonal surge in lending every January. Crucially, this January’s figure was below the Rmb2.54 trillion during the […]
Oil Prices Start To Catch Up With Supply And Demand Realities
By John Richardson I HATE to say “I told you so,”, but I have been telling you that this would happen. Oil prices on Thursday fell below $50, and were at their lowest levels since December as the realities of supply and demand caught up with the market In summary, I have been arguing the following […]