By John Richardson ASIAN naphtha cracker operators will see a 50% decline in average spreads, or differentials, between their raw-material costs and finished product prices in 2018 compared with last year, according to my forecasts in the above chart. This will be the result of a further steep rise in oil prices and increased polyethylene […]
Asian Chemical Connections
Petchems Pricing Power, Operating Rates Tell Real Economic Story
By John Richardson PETROCHEMICALS and polymers pricing power – how easily petrochemicals producers can pass-on higher oil prices to their customers – is a great measure of the strength of the overall global economy. The reason is that petrochemicals are used to make a huge range of finished goods. In a booming economy, the pass-through […]
Asian Naphtha-PE Spreads Collapse By 80% As 2018 Challenges Build
By John Richardson ASIAN naphtha-to-polyethylene (PE) spreads collapsed by 80% in the first week of January compared with December last year because of the failure to pass on the rise in naphtha feedstock costs resulting from higher oil prices. In an update of the chart I’ve been running since late last year, what you see […]
Peak Oil And The Aramco/SABIC Petchems Project
By John Richardson THERE is an important connection between this week’s announcement by Saudi Aramco and SABIC of an MoU for a direct oil-to-chemicals complex and the Tesla Semi electric truck, which is being trialled by DHL and other logistics companies. To fully understand this link, let’s first consider the wider context behind the Tesla truck […]
China Govt Policy To Shape Petchems Demand, Pricing In 2018
By John Richardson NAPHTHA feedstock costs are on the way up, which is of course the result of higher crude prices. So far this year, the naphtha cost for Asian steam cracker operators has averaged $479/tonne CFR China. But our forecast for November 2017-March 2018 is $541/tonne CFR China. This might turn out be an […]
Benefits, Risks Of Petronas/Aramco Deals Serving As Template
By John Richardson THE PETRONAS and Saudi Aramco joint ventures in the RAPID refining-to-petrochemicals project in Malaysia may serve as a template for further “win/win deals”. Whilst these deals will substantially benefit the companies and countries involved, there are broader risks that I’ll discuss at the end of this blog post. Back in February, Aramco […]
Climate Change, Extreme Weather: Implications For Chemicals Companies
By John Richardson The greater frequency of extreme weather events presents a huge challenge for chemicals companies. Take Hurricane Harvey and Hurricane Irma as the most obvious current examples. Weather forecasting service AccuWeather writes in this article: This is the first time in the history of record keeping that two Category 4 or higher hurricanes, […]
Supply-Driven Petrochemicals Success Under Threat
By John Richardson THE OLD joke goes like this: “If oil and gas exploration is the gorilla, refining the dog and petrochemicals the tail on the dog, what does the gorilla say when he looks at the dog? He says, “I can’t even see the tail on the dog’ ”. The history So events upstream […]
Asian Ethylene Markets: What We Definitely Know
By John Richardson FORECASTING the absolute future price of any petrochemical has always been difficult and if you are ever exactly right this will be down more to good luck than good judgement. And the problem is that when you have been right once, and you make a big song and dance about it, everyone […]
Shallow Discussions Versus Complex Oil Price, Economic Realities
By John Richardson IT has been a very good year so far for European and Asian naphtha cracker operators, as the chart above illustrates. As you can see, in the case of high-density polyethylene (HDPE), naphtha-based integrated margins in 2015 are turning out to be a better so far this year than those in 2013 […]
Jump to page: