By John Richardson THE “last big man standing’, as polyethylene (PE) was described to me during my visit to Shanghai last week, is widely expected to remain in major deficit in China for the next decade at least. As PE is the foundation of the cracker business – i.e. it is the main reason […]
Asian Chemical Connections
Saudi Arabia, Refining And The Battle for Crude Market Share
By John Richardson SAUDI ARABIA is determined to win its battle for greater market share of the global oil market, and at the same add value downstream to its hydrocarbon reserves. This is the consistent message I have picked over the last 18 months. And so a report in the Financial Times that Saudi Aramco […]
Why US Natural Gas Will Stay Very Cheap
By John Richardson CONVENTIONAL thinking about US natural gas prices is that they will start to edge up over the next few years. Reasons include major shale gas investment cutbacks resulting from the recent collapse in US natural gas pricing. Gas availability is also widely expected to tighten as a result of cutbacks in US […]
US Shale Oil Was Never Going To Stand Still
By John Richardson TECHNOLOGY doesn’t stand still. That’s the whole point about technology as any oil, gas or chemicals engineer will tell you. The above chart is a fantastic example of this. It shows how the efficiency of US oil rigs, thanks to improvements in the fracking process, has improved by leaps and bounds from […]
US Ethane Shipments And The Broader Picture
By John Richardson THE first shipment of ethane from the US to Europe, which is set to arrive on Wednesday to feed the INEOS cracker at Rafnes in Norway, will be widely interpreted as meaningonly one thing: That nothing in petrochemicals has essentially changed , as most of what we do to be successful is […]
Seven Risks Of Choosing Specialties Over Commodites
By John Richardson CHEMICALS analysts love to talk with great enthusiasm about the specialty end of this business because margins per tonne can be a great deal higher than in boring old plain vanilla commodities. Specialties is an exciting story to spin to investors, as it contains “buzz” phrases such as “value addition” and “innovation”. […]
How To Grow Sales In A Deflationary World
By John Richardson CHINA hugely increased its propylene and derivatives capacity to the point where by 2011, it became the first region or country where downstream propylene consumption surpassed that of ethylene. This didn’t mean booming actual demand for propylene and what it is used to make. Instead, it meant that lots of “empty factories” […]
Oil Price Recovery: Please Remember 2015
By John Richardson EVEN if oil prices should go down right now, based on supply and demand fundamentals, the financial players will not let that happen. This is the view of several analysts who point to the closure of numerous short positions, in favour of opening long positions, over the last few weeks. In time-honoured […]
Demand: The New Direction for Profit
By John Richardson WE were right about China’s change of economic direction, which we identified in November 2013. We were then right about the collapse in oil prices from August 2014 onwards. And we also made the right call when we pointed out that these two events are inextricably linked. Being right in the past is, […]
China: Wrong Questions Will Give You The Wrong Answers
By John Richardson IF you start with the wrong questions about China, you are obviously going to end up with the wrong answers. In the case of China’s polyolefins industry, too many people are still asking themselves this wrong question: How can inland coal-to-polyolefins plants survive, never mind run at high operating rates, because of […]