By John Richardson OIL prices rose yesterday, despite the latest Energy Administration Information (EIA) report for the week ending 28 August revealing that: Total US commercial stocks grew by 5.7 million barrels a day – and at 1.29 billion barrels are the highest level ever reached. (Number crunching, courtesy of David Hutton of the PVM […]
Asian Chemical Connections
Time To Scrap Old Thinking On Oil Markets
By John Richardson A SEASONAL fall-off in demand for oil, rising concerns over the Chinese economy and worsening global oversupply of crude could push oil down into the $30 dollars a barrel range, a majority of analysts surveyed by the Wall Street Journal now believe. And money manager David Kotok has told CNNMoney that oil […]
$30 A Barrel Crude: Six Reasons Why It Will Happen Again
Want to know what do next? Then contact ICIS Consulting at john.richardson@icis.com By John Richardson IT WAS clear as early as January 2013 that US shale-oil production was on the rise. Back then I warned that this new supply threatened an oil-price correction. If you stepped back from the consensus, it was also clear […]
US Oil, Gas, Chemicals Drowning In Excess Of Credit
By John Richardson THE US oil, gas and petrochemicals sectors are drowning in an excess of credit that has distorted rational analysis of long-term supply and demand fundamentals. So, just as is the case with China manufacturing in general, these misguided investments are in danger of contributing to a prolonged period of global deflation. Let’s […]
Oil Prices, The Chase For Yield And Another Roll Of The Dice
By John Richardson GILLIAN Tett, the outstanding financial journalist, talked about “silo thinking” in her book – Fool’s Gold – that detailed the root causes of the Global Financial Crisis. By this she meant how too many people only had deep knowledge of one particular aspect of how financial markets were supposed to work – […]
US Fed Reinvents 19th Century Boom And Boost Oil Markets
By John Richardson ONE way of looking at the world is that central bankers know exactly what they are doing as they are Masters of the Universe. These bankers have excellent degrees and doctorates from top universities bursting out their CVs, along with fantastic track records of rescuing the global economy, I have often been […]
Why The New Belief In Oil-Price Stability Is Wrong
By John Richardson THE new consensus view on oil prices, based on my discussions with many delegate on the side lines of this year’s Asia Petrochemical Industry Conference (APIC) in Seoul, South Korea, seems to run roughly as follows: OK, most of us completely missed the H2 2014 collapse of crude, but never mind, we now […]
US Resumes The Pointless “China Blame Game”
By John Richardson IT IS human nature not to want to admit you are wrong. Nobody likes owning up to mistakes. What is instead a lot easier is to look for someone else to blame when things start going very badly wrong against all your earlier expectations. A good example might just have occurred in […]
China’s Damage Limitation: The Reserve Requirement Cut
By John Richardson DAMAGE limitation is the motive behind China’s decision cut its reserve requirement ratio (RRR) by 0.5% to 19.5%. (The RRR is the amount of money that banks have to set aside against this lending, and so the lower the percentage the more the capacity to lend). The decision, which was announced yesterday […]
US Petrochemicals: Three Predictions For 2015
By John Richardson AS you can see from the table below, there are no less than 12 US ethane-based cracker projects being planned with lots of associated downstream capacity. Theoretically, this represents: 14.8m tonnes/year of new ethylene capacity at these 12 proposed facilities. There are also eight planned expansions of existing plants, adding up to […]