TOPIC PAGE: War in Ukraine, gas crisis

Aura Sabadus


Updated at 10:45 GMT on 4 August with latest headlines. Please scroll down to see headlines.

Map of gas-related outages updated at 17:45 GMT on 22 July. 

The war in Ukraine first caused oil price volatility, which increased as surging COVID-19 cases in China led to fresh lockdowns, hitting demand and disrupting supply chains. China is the world’s second biggest economy and largest oil importer.

Now Russia’s decision to reduce flows of natural gas to Europe means the continent has to look forward to a winter of potential rationing, which could hit chemical production. Tightened supply has also sent gas prices soaring, with high costs forcing production cuts, especially in fertilizers.

India is facing a more severe shortage of fertilizers and edible oil amid wide-ranging trade disruptions as the Ukraine war rages on, with financial sanctions tightening on Russia.

Europe’s energy challenge is immense and put into stark relief by the response to Russia’s war in Ukraine. Cutting the ties that bind EU and non-EU nations to Russian gas and oil will be extremely painful this year and in years to come: the actions proposed by the European Commission put that into context.

This topic page examines the impact of the Ukraine conflict on oil, gas, fertilizer and chemical markets.

Image credit Vadim Ghirda/AP/Shutterstock

Europe’s energy markets witnessed a year of record prices and extreme volatility in 2021. Russia’s invasion of Ukraine has led to more difficult conditions for global markets in 2022.


  • Gas storage low in Europe, winter demand 30% higher than rest of year
  • Record shipments of liquefied natural gas (LNG) to Europe so far in 2022
  • LNG could ease Europe shortages if Russia supplies cut
  • Europe LNG processing operating at full capacity
  • Russia resumed flows through Nord Stream I pipeline, but at reduced levels
  • EU plan calls for a 15% cut to consumption, industry may face much higher reductions


  • Russia supplies 20% of global seaborne ammonia market
  • Disrupted supply has pushed up fertilizer and food prices


  • Friendship oil pipeline flows through Ukraine
  • Russian oil feeds around a quarter of Europe demand
  • Europe seeks to end reliance on Russian crude oil


  • High Europe gas and electricity prices force price hikes, energy surcharges
  • Volatile oil and feedstock prices dent chemical producer margins
  • Elevated oil prices dent consumer confidence and demand
  • CEOs plan now for winter gas rationing
  • BASF says it will have to close Ludwigshafen site if gas supplies fall below 50% for a prolonged period

Europe is heavily reliant on Russian gas and exposed to disruptions in supply,  but Russia is also an important oil exporter and a supplier of fossil fuel products, which find their way to international markets via Ukraine’s ports.

Sanctions and measures against Russian exports of oil and gas have sent shockwaves across the global economy, lifting the cost of living, impacting industrial and agricultural production and potentially leading to social unrest.

ICIS has taken a broader perspective, asking how vulnerable energy and energy-related supplies are to disruptions, what contingency plans are put in place and what could be expected in the upcoming weeks.

How vulnerable are energy and energy-related Russian supplies to disruptions?
Europe depends for close to 40% of its annual gas consumption on Russian supplies, imported via four routes – Ukraine, Belarus-Poland as well as the Nord Stream 1 and TurkStream corridors linking Russia to Germany and Turkey via the Baltic and Black Sea, respectively.

Overall Russian pipeline supplies were limited throughout 2021, and since the beginning of this year producer Gazprom has shipped only one-third of the gas that it was expected to deliver to European consumers via Ukraine as part of a five-year transit agreement.

Russia has banned exports of gas to several EU countries, and reduced flows through the Nord Stream I pipeline. European petrochemicals players face even higher gas prices as a result. Fertlizer companies – where gas can account for 80% of costs – have been forced to curtail production.

If the conflict escalates, Ukraine transit pipelines may come under attack but disruptions could be limited because the infrastructure has been built to grant flexibility, allowing the operator to reroute flows away from potentially damaged segments.

The Togliatti-Azot pipeline, the world’s longest ammonia pipeline stretching 2,471km from the Togliatti Azot plant in Russian Samara Oblast to the Ukrainian Black Sea port of Yuzhny, could be caught up in the cross-fire. Russian ammonia supplies account for around 20% of the global seaborne merchant ammonia market each month.

Around two thirds of those volumes are exported via Yuzhny, with the rest reaching European and global markets via Baltic ports. Ammonia is a prime material for fertilizers, so curtailments could potentially lead to higher food prices and shortages.

Ammonia market players are scrambling to cover positions and assess options as the Russian invasion of Ukraine saw loadings at the key export hub of Yuzhny halted with immediate effect.

Russian nitrogen fertilizer major Togliatti confirmed the suspension of the transit of ammonia to the Black Sea port via pipeline to ensure the safety of people living in the vicinity of the lengthy conduit.

The Samara Oblast-based giant also confirmed the shut down of four of its seven ammonia units, with the other three plants operating at reduced rates.

Supplies on the world’s longest oil pipeline, the Friendship (Druzhba) pipeline, could be threatened if the conflict leads to tough sanctions. The pipeline carries oil from central Russia 4,000km west to Ukraine and Belarus and runs close to the Belarus-Ukraine border. Russia exports around 5m bbl/day, of which half are exported to Europe, including via this pipeline.

Russian oil accounts for about a quarter of Europe’s consumption, with the Druzhba pipeline carrying close to 1m bbl/day. Should sanctions be imposed and exports hindered, Europe will need to secure alternative cargoes from the global market.

Europe consumed most exports of Urals, Russia’s biggest export grade, in 2021 after Saudi Arabia boosted market share in China. Almost 10m tonnes of Urals went through Rotterdam in the first half of last year, up 2m tonnes on 2020.

Germany stands most exposed because it gets 25% of its oil from Russia.

Gas and electricity are important components in the production costs of many chemicals. Surging gas and feedstock prices in Europe have caused big hikes in contract and spot prices.

Europe is now at a competitive disadvantage to other regions and some customers are seeking new sources of lower-priced supply, especially from Asia and the Middle East.

The conflict in Ukraine has pushed European gas prices back up to record levels, so some chemical producers may consider ceasing production, or adding further energy surcharges.

Rising oil prices since late 2021 have already put chemical margins under pressure, and this has continued into 2022. As oil and naphtha prices soared, margins for ethylene production based on naphtha went nagative for the first time ICIS record began. The are now are swinging wildy in tandem with oil price movements.

Chemical producers are struggling to pass on increasing naphtha feedstock and energy costs, especially in Europe. Elevated oil prices also dent downstream consumer confidence and spending.

What contingency plans are being put in place?
US and European officials have been planning for backup LNG supplies. Exports of LNG from Algeria, Qatar, the US and even Australia have been discussed as alternatives. Although Europe imported a record 11bn cubic metres (bcm) of LNG in January alone, half of which were sourced in the US, much of future supplies would depend on price as well as supply and processing capacity.

Europe is proposing to replace 100bn cubic metres (m3) of Russian gas with alternative supplies by the end of the year.

“In this scenario, there would be huge problems unless Europe gets it act together. I estimate that even with new liquified natural gas (LNG) supplies from the US, Norway, and Qatar plus energy efficiency measures and more use of renewables, Europe would still be short by 30-40bn m3,” said ICIS senior energy editor, Aura Sabadus.

Infographic: Which European Countries Depend on Russian Gas? | Statista You will find more infographics at Statista

If the Asian premium were to increase, LNG cargoes would head in that direction, even as seasonal European winter gas demand is on average 30% higher than the rest of the year.

Supply disruptions caused by escalating tensions may lead to a price rebound, incentivising more LNG to return to Europe.

However, European import terminals are already operating at nameplate capacity. A record of 5,000GWh/day was reached in mid-January, according to EU data.

Even if more LNG were to reach European terminals, countries in central and eastern Europe which rely on Russian flows shipped via Ukraine, would struggle to secure imported LNG.

For oil markets, in case of an attack but no international sanctions, the worst-case scenario would be for approximately 240,000 bbl/day of lost Russian exports via Ukraine.

There are other seaborne routes, including the Russian Black Sea port of Novorossiysk.

Gas rationing – impact on Europe petrochemicals, fertilizers

Embattled European fertilizer and petrochemical producers may be the first in line to cut gas consumption as political pressure is mounting to save supplies ahead of a difficult winter.

As Russia, Europe’s largest gas supplier, has been limiting exports to less than a quarter of its deliveries two years ago and may stop them altogether amid its political stand-off with the EU, Brussels has now issued guidance to reduce demand by 15% between 1 August 2022 – 31 March across member states.

Policymakers recommend voluntary reductions but say these would become mandatory in case of a supply emergency jeopardising the bloc’s security.

The EU’s largest consumers include households, accounting for 37% of total demand, electricity and heat generation covering around 30% and industrial consumption accounting for another 30%.

Record high gas prices and an ongoing gas supply crunch over the least year have already been forcing industrial consumers to limit or stop production or seek import substitution globally.

Data compiled by ICIS Gas Analytics show that overall year-on-year gas demand has declined by 8.2% in the year to date and by 3.9% for the same period over the 2015-2019 average.

EU proposals for demand reduction released on 20 July indicate the industrial sector may be priority target for major reductions, with three sectors – glass, ceramics and chemicals – consuming half of the sector’s total.

The fertilizer sector, one of the most gas-intensive industries, has also been one of the most affected so far because with gas prices soaring more than five times the long-term average in recent months, the cost to produce ammonia and urea rose to $1,700/tonne and $1,250/tonne respectively.

This is around 60% above the current market price of these key products of the fertilizer sector.

ICIS experts focusing on the fertilizer sector estimate that as much as 40% of urea production may have been cut year on year in Europe, although the information is difficult to confirm since there is no official confirmation on specific output limitations.

On the petrochemicals side, there have been no reports of shutdowns or production reductions, but producers are making detailed plans for rationing, particularly in Germany, where the chemicals and pharmaceuticals industry uses about 140 TWh per year, or about 15 percent of Germany’s gas consumption.

Gas is mainly used by petrochemicals to generate energy such as electricity and steam as well as to fire furnaces for production complexes such as crackers.

Sites are able to lower operating rates significantly, but they may be forced to close if gas supplies drop so much that production becomes uneconomic or difficult from a technical perspective.

BASF’s Ludwigshafen site is the world’s largest integrated chemical complex owned by a single company and confirmed to ICIS that it will have to shut down if gas supply collapses by more than half for a sustained period of time.

Ukraine conflict threatens Europe oil supply, chemicals production

With Russia’s invasion of Ukraine, sanctions could cut supplies of crude oil through the Druzhba pipeline, threatening oil refinery operations and chemicals production at installations in Hungary, Slovakia, Czech Republic, Poland and the former East Germany.

Russian oil supplies up to a quarter of Europe’s crude imports, with refineries in central and eastern Europe, which are attached to the Druzhba pipeline, particularly reliant on these supplies. Any interruption to these supplies could force refineries to reduce operating rates unless they can find alternative supplies.

Analysis of the ICIS Supply & Demand database shows that the countries Druzhba runs through, except for Germany, are reliant on Russian crude oil for more than half of their imports, led by Slovakia which obtained 96% of its supplies from Russia in 2021.

Chemical production downstream of refineries in these countries could be impacted by any reduction in operating rates. The ICIS data forecast that for 2022, 2.79m tonnes of ethylene (11% of total European capacity) and 2.34m tonnes of propylene (12% of total European capacity) are reliant on refineries located along the Druzhba pipeline. While some alternative sources of crude oil could be sourced, it is unlikely normal levels of operations could be maintained.

Michael Connolly, ICIS Principal Analyst Refining said: “Although many have built alternate sources, keeping full operating rates would be difficult for them as they rely on a consistent and reliable source of crude. Most refiners in Europe are aware of the risk of Russian crude and over the past 5-10 years have tried to reduce their dependence, or at least to build some capability to have an alternate supply – it doesn’t mean they would be unaffected, but there should be a little bit of resilience, depending on the site.”

Connolly explained that some land-locked refineries along the Druzhba pipeline have built pipelines to the coast, allowing alternative sources of crude oil to be sourced. However, these pipelines may not have capacity to feed the whole refinery.

A spokesperson for Grupa LOTOS said: “The LOTOS refinery has dealt with suspended supplies by land before. Due to the contamination of Russian oil with chlorines, PERN, the state-owned operator of transmission and storage infrastructure, had to completely discontinue the transmission of crude oil from the eastern direction between 24 April and 9 June 2019.”

He added that scheduling of oil supplies by sea helped to secure volumes sufficient to maintain an unchanged level of throughput and maximise fuel production.

TotalEnergies and PKN Orlen declined to comment while MOL and PCK have not yet replied to requests for comment.


With Russian forces advancing across Ukraine, chemical and fertilizer facilities may be threatened by physical damage, interrupted power and gas supplies or logistics disruption.

Kalush cracker closed

Karpatnaftohkhim’s cracker at Kalush has been closed down because of the imposition of martial law in Ukraine. It has capacity (tonnes/year) of 250,000 (ethylene); 117,000 (propylene) 110,000 (LLDPE), 300,000 (PVC), 100,000 (benzene).

Black Sea export hub closed 

Ammonia market players have scrambled to cover positions and assess options as the Russian invasion of Ukraine saw loadings at the key export hub of Yuzhny halted with immediate effect.

Russian nitrogen fertilizer major Togliatti confirmed the suspension of the transit of ammonia to the Black Sea port via pipeline to ensure the safety of people living in the vicinity of the lengthy conduit.

The Samara Oblast-based giant also confirmed the shut down of four of its seven ammonia units, with the other three plants operating at reduced rates.

Russia export disruptions to shift global trade flows, future capacities threatened
Disruptions to Russia’s chemicals and polymers exports will change trade flows, particularly to Europe and Asia, as international sanctions, lack of logistics and even “self-sanctions” limit volumes.

While Russia’s capacities are relatively small on a global scale, they can still have a significant impact on regional markets if these exports are disrupted.

Key Russia exports include methanol, polyethylene (PE), polypropylene (PP), styrene and paraxylene (PX).

Russia has increased exports of high density polyethylene (HDPE) and polypropylene (PP) in particular in 2020 and 2021 as new capacity started up from SIBUR’s ZapSibNeftekhim complex in Tobolsk in 2020.


Asia BDO extends losses as demand at a low ebb
By Clive Ong 04-Aug-22 16:47 SINGAPORE (ICIS)–The Asian butanediol (BDO) market extended losses with the downtrend still firmly entrenched. Market participants expect further downside potential in the near term as the decline that started in April does not appear to have run its course.

PODCAST: LPG substitution of higher-priced LNG limited in China
By Yan Wang 04-Aug-22 15:37 GUANGZHOU (ICIS)–ICIS analysts Wang Yan and Xu Fei discuss with Asia deputy news editor Pearl Bantillo why China is not aggressively using liquefied petroleum gas (LPG) as substitute for liquefied natural gas (LNG) in fuel applications in industries despite global supply concerns and soaring LNG prices.

Asian import offers for NBR fall with weak demand, outlook bleak
By Ai Teng Lim 04-Aug-22 10:34 SINGAPORE (ICIS)–Asian spot import offers for acrylonitrile butadiene rubber (NBR) have slipped lower as sellers widened discounts to chase deals in a low-demand market.

India July exports slip; trade deficit widens to record $31bn
By Priya Jestin 03-Aug-22 14:43 MUMBAI (ICIS)–India’s merchandise exports in July dipped for the first time in over a year, while increased imports of crude oil and coal bloated the country’s trade deficit to a record $31bn.

Asia butac, etac slump; demand tepid on weak regional currencies
By Melanie Wee 02-Aug-22 17:41 SINGAPORE (ICIS)–Asia’s butyl acetate (butac) markets are being weighed down by tepid demand as continued weakness of currencies in the region continues to undermine imports.

Asia July industries – a mixed bag as battle with inflation continues
By Nurluqman Suratman 02-Aug-22 13:59 SINGAPORE (ICIS)–Asia’s manufacturing sector in July presented a mixed performance, with major economies in the northeast showing a marked slowdown in activity, as the region continues to contend with high input costs and weak demand.

OUTLOOK: Asia epoxy resins to stay sluggish; price competition may intensify
By Luffy Wu 02-Aug-22 13:46 SINGAPORE (ICIS)–Uncertain end-demand outlook and recession fears continue to haunt Asia’s epoxy resins market, with aggressive exports from China forcing some regional suppliers to lower offer.

South Korea July inflation nears 24-year high at 6.3%
By Nurluqman Suratman 02-Aug-22 12:26 SINGAPORE (ICIS)–South Korea’s consumer price index (CPI) rose by 6.3% year on year in July, accelerating from 6.0% in the previous month and the fastest rate recorded in nearly 24 years.

OUTLOOK: Europe soda ash market considers quarterly prices as yearly contracts see further correction
By Anne-Sophie Briant-Vaghela 28-Jul-22 18:33 LONDON (ICIS)–Northwest Europe (NWE) and Black Sea contract prices rose 3% and 5.4% from Q2 contract prices this week, marking a third adjustment to annual agreements settled in Q4 last year, as the market reconsiders the pace at which to negotiate prices going forward in the face of heightened volatility in upstream markets.

OUTLOOK: Asian OX demand to stay soft, export opportunity to the West
By Samuel Wong 28-Jul-22 16:47 SINGAPORE (ICIS)–Demand for Asian orthoxylene (OX) is expected to stay soft for the second half of the year, amid a pessimistic downstream demand outlook going forward.

Shell Q2 chemicals loss of $158m as margins hit
By Nigel Davis 28-Jul-22 17:54 LONDON (ICIS)–Higher feedstock and utility costs and higher turnaround activities hit Shell’s chemicals earnings in the second quarter, the energy giant said on Thursday.

PODCAST: Asia C2, downstream recovery in H2 fraught with risks
By Jasmine Khoo 28-Jul-22 15:25 SINGAPORE (ICIS)–The first half of 2022 saw widespread cutbacks in Asia’s cracker and downstream operating rates as the market faced more headwinds from the war in Ukraine and COVID flare-ups in China.

Belgium’s Solvay Q2 underlying profit jumps on higher prices, strong demand
By Pearl Bantillo 28-Jul-22 14:42 SINGAPORE (ICIS)–Solvay’s second-quarter underlying profit increased 70% year on year on the back of higher prices and a 6% increase in sales volumes amid strong demand across key markets, the Belgian specialty chemicals producer said on Thursday.

S Korea’s S-Oil Q2 net income more than doubles; Q3 PX spread to weaken
By Nurluqman Suratman 28-Jul-22 13:38 SINGAPORE (ICIS)–S-Oil’s second-quarter net income more than doubled year on year on strong refining margins and robust aromatics demand, but the South Korean producer’s paraxylene (PX) spread is expected to weaken in July-September 2022.

Fitch downgrades PTTGC rating as high costs to hit earnings
By Pearl Bantillo 25-Jul-22 17:44 SINGAPORE (ICIS)–Fitch Ratings has downgraded PTT Global Chemical’ long-term national rating and senior unsecured rating to “AA” from “AA+” given weaker earnings prospect for the Thai producer.

Singapore June core inflation at 4.4% – highest since Nov 2008
By Nurluqman Suratman 25-Jul-22 14:11 SINGAPORE (ICIS)–Singapore’s core year-on-year inflation in June stood at 4.4%, up from 3.6% in May and the highest hit since November 2008, official data showed on Monday.

India’s RIL Q1 oil-to-chems earnings jump 63%; cracker rates fall to 87%
By Nurluqman Suratman 25-Jul-22 12:36 SINGAPORE (ICIS)–Reliance Industries Ltd’s (RIL) oil-to-chemicals net profit increased by around 63% year on year in its fiscal first quarter ending June 2022 on the back of higher oil and product prices.

BLOG: Europe’s gas crisis: the implications for global chemicals
By John Richardson 25-Jul-22 11:41 SINGAPORE (ICIS)–Click here to see the latest blog post on Asian Chemical Connections by John Richardson. The European chemicals is no doubt in the midst of intensive crisis management because of the risk that this winter will see power cuts and interruptions in the supply of natural gas supply needed for feedstocks and to run furnaces, etc.

INSIGHT: Weakening Asian currencies stifle petrochemical demand
By Felicia Loo 22-Jul-22 13:41 SINGAPORE (ICIS)–The continued depreciation of Asian currencies against the strong US dollar is quashing hopes of a petrochemical demand recovery, as imports become more expensive, eroding the purchasing power of buyers in the region.

INSIGHT: Europe chemicals must prepare now for deep gas cuts
By Will Beacham 22-Jul-22 11:00 LONDON (ICIS)–Chemical companies across Europe need to prepare now for an almighty battle over gas rationing as winter approaches.

The Nord Stream pipeline is back online at around 40% capacity, but it may continue to operate at very reduced rates and could easily be switched off again if the Kremlin decides to continue using it as a political weapon to hurt Europe’s economy. Gas rationing is still likely this winter, with or without this source of supply.

INSIGHT: Ferts, petchems in firing line as EU gas stockpile pressure intensifies
By Aura Sabadus 20-Jul-22 18:38 LONDON (ICIS)–Embattled European fertilizer and petrochemical producers may be the first in line to cut gas consumption as political pressure is mounting to save supplies ahead of a difficult winter.

As Russia, Europe’s largest gas supplier, has been limiting exports to less than a quarter of its deliveries two years ago and may stop them altogether amid its political stand-off with the EU, Brussels has now issued guidance to reduce demand by 15% between 1 August 2022 – 31 March across member states.

Gas flows resume on Nord Stream pipeline but remain below capacity
By Tom Brown 21-Jul-22 12:22 LONDON (ICIS)–Flows resumed on Thursday along the Nord Stream natural gas pipeline between Russia and Europe, but the volume of deliveries remains significantly below capacity.

Running between Russia and Germany, the pipeline is a key part of the EU’s energy infrastructure, and there had been questions over whether gas deliveries would resume once work had been completed.

Inflation to stay ‘undesirably’ high in mid-term – ECB’s Lagarde
By Tom Brown 21-Jul-22 23:42 LONDON (ICIS)–Inflation levels in the eurozone are expected to remain high for some time, European Central Bank (ECB) president Christine Lagarde said on Thursday, as the bank moved to hike each of its key interest rates and prepare a new bond purchase scheme.

OUTLOOK: Asia PX to take cue from downstream in H2; tight supply to ease
By Samuel Wong 21-Jul-22 13:57 SINGAPORE (ICIS)–Asia’s paraxylene (PX) is expected to take its cue from the downstream purified terephthalic acid (PTA) market in the second half of 2022, moving away from the previous strong support from gasoline blending markets.

Developing Asia GDP growth cut to 4.6% on China slowdown – ADB
By Nurluqman Suratman 21-Jul-22 12:05 SINGAPORE (ICIS)–The Asian Development Bank (ADB) on Thursday cut its GDP growth forecast for developing Asian countries to 4.6% from its previous projection of 5.2%, with China’s growth lowered by a full percentage point to 4.0%.

INTERVIEW: Financing market a major headwind for chemical deals – banker
By Joseph Chang 18-Jul-22 23:53 NEW YORK (ICIS)–Extremely challenged debt markets will be a major headwind for leveraged chemical deals going forward, an investment banker said.

Global weekly spot IPEX down significantly on falls across regions
By Yashas Mudumbai 18-Jul-22 17:40 LONDON (ICIS)–The spot chemicals index dropped by 5.2% as falls across regions continued, according to the latest figures from the weekly ICIS Petrochemical Index (IPEX).

Asia July petrochemicals on general downtrend; sentiment to stay bearish
By Jimmy Zhang 18-Jul-22 17:07 SINGAPORE (ICIS)–Downward price corrections have been seen for crude and Asia’s petrochemicals markets in July, following a general increase in June. ICIS expects the bearish sentiment to continue throughout the month as previous sharp increases in crude prices may not be seen again for the rest of 2022.

OUTLOOK: Asia FAE demand to stay soft on sluggish Chinese economy
By Helen Yan 15-Jul-22 17:37 SINGAPORE (ICIS)–Asia’s fatty alcohol ethoxylates (FAE) demand is expected to remain soft in the near term due to prevailing weak market conditions and a sluggish Chinese economy.

OUTLOOK: Asia VAM correction accelerates; H2 demand to stay weak
By Helen Lee 15-Jul-22 15:48 SINGAPORE (ICIS)–Asia’s vinyl acetate monomer (VAM) market correction has accelerated (this week) since late May (late May refers to the start of the correction) on broad-based demand slowdown, with inflationary pressures dampening the outlook in the second half.

Indonesia palm oil shipments surge 89% in June after lifting export ban
By Nurluqman Suratman 15-Jul-22 15:20 SINGAPORE (ICIS)–Indonesia’s shipments of palm oil and its derivatives surged by 89.3% year on year in June following the lifting of an export ban a month earlier, official data showed on Friday.

World petrochemical market sentiment weak as demand falters
By Felicia Loo 15-Jul-22 14:12 SINGAPORE (ICIS)-Global petrochemical markets are mired in a challenging situation writ large, with demand dull as recession risks gather pace.

OUTLOOK: East, South Asia LAB at a crossroad amid elevated economic uncertainty
By Clive Ong 15-Jul-22 11:12 SINGAPORE (ICIS)–Linear alkylbenzene (LAB) markets in east and south Asia are at a crossroad with the path ahead mired in uncertainty. With outlook increasingly clouded, participants found decision-making an onerous task.

Inflationary pressures could impact economic growth in Europe for coming years
By Morgan Condon 14-Jul-22 22:55 LONDON (ICIS)–The European economy is set to hit record highs for inflation this year as the Russian invasion of Ukraine has driven energy and food prices higher, but volatile macroeconomic conditions obfuscate when sentiment will calm down.

INSIGHT: Asia C2, downstream recovery in H2 fraught with risks (Part 2)
By Yeow Pei Lin 14-Jul-22 13:00 SINGAPORE (ICIS)–The outlook for Asia’s ethylene derivatives remains largely weak in the second half of 2022. Capacity is growing across downstream sectors but demand is uncertain amid China’s zero-COVID stance and global recession fears.

INSIGHT: Asia C2, downstream recovery in H2 fraught with risks
By Yeow Pei Lin 13-Jul-22 13:00 SINGAPORE (ICIS)–The first half of 2022 saw widespread cutbacks in Asia’s cracker and downstream operating rates as the market, which was already sagging under the weight of huge capacity increases in South Korea and China, faced more headwinds from the war in Ukraine and COVID flare-ups in China.

Singapore tightens monetary policy further to tame inflation
By Nurluqman Suratman 14-Jul-22 13:53 SINGAPORE (ICIS)–Singapore’s central bank unexpectedly tightened its monetary policy on Thursday in a bid to quell mounting inflation pressures, which are expected to continue heating up this year.

OUTLOOK: China base oils imports to continue decline in H2
By Whitney Shi 12-Jul-22 13:43 SINGAPORE (ICIS)–China’s base oils imports slumped year on year in January-June 2022 on strong import prices, which will likely persist into the second half although demand from downstream lubricant producers could improve in the third quarter.

LNG shipping activity rises in both basins
By Roman Kazmin 12-Jul-22 11:39 SINGAPORE (ICIS)–South Korean shipowner H-Line has chartered a vessel for a single voyage on behalf of the incumbent KOGAS as charter activity steps up in the Atlantic and Pacific basins.

Crude falls nearly $2/bbl on fresh China COVID-19 curbs
By Nurluqman Suratman 12-Jul-22 11:08 SINGAPORE (ICIS)–Oil prices fell by nearly $2/bbl on Tuesday morning on worries over fresh COVID-19 restrictions in China, the world’s biggest crude importer.

OUTLOOK: Asia naphtha braces for H2 with trepidation, frail demand
By Melanie Wee 12-Jul-22 10:33 SINGAPORE (ICIS)–Asia naphtha markets are headed for challenging times as cautious demand outweighs oil supply concerns.

Europe petchems natgas worries rise as Nord Stream 1 enters maintenance
By Morgan Condon 08-Jul-22 17:18 LONDON (ICIS)–The threat of short gas supply in Europe is causing concern in the region’s petrochemicals industry and could begin to weigh down on production.

INSIGHT: UK chemicals battle ‘Four Horsemen of the Apocalypse’
By Will Beacham 08-Jul-22 18:23 LONDON (ICIS)–The UK’s chemical sector is battling against “The Four Horsemen of the Apocalypse” as it is battered by the fallout from Brexit, COVID-19, the cost of living crisis and the war in Ukraine, according to the CEO of trade group The Chemical Industries Association (CIA).

Malaysia May chemicals sales up 7.7%; high inflation threatens production
By Nurluqman Suratman 08-Jul-22 16:16 SINGAPORE (ICIS)–Malaysia’s chemicals sector sales in May rose by 7.7% year on year, supporting the overall expansion in manufacturing revenue, but inflation headwinds are expected to continue to weigh on overall factory activity.

NE Asia ethylene stays weak; August demand recovery likely tepid
By Yeow Pei Lin 08-Jul-22 10:53 SINGAPORE (ICIS)–Northeast Asia’s spot ethylene import prices fell for a 14th week as poor downstream demand continued to outweigh production cuts.

Crude trades below $100/bbl on global recession fears
By Nurluqman Suratman 07-Jul-22 12:02 SINGAPORE (ICIS)–Oil prices were extending losses on Thursday, with both key benchmarks trading below the psychological $100/bbl mark, amid growing concerns that the global economy will again plunge into a recession.

Asia petchems mired in bearishness on elevated recession fears
By Felicia Loo 07-Jul-22 11:21 SINGAPORE (ICIS)–Asian petrochemical markets are in a jam, with price bearishness across the board as recession risks continue to mount. Elevated concerns on the economic front, from the fallout of the Russia-Ukraine conflict and sanctions on Russia, plus fears of upward spiralling inflation continue to weigh on sentiment.

OUTLOOK: Tight supply concerns flip to reduced oil demand by Q4
By Barney Gray 07-Jul-22 00:49 LONDON (ICIS)–Oil prices were in a post-Covid recovery phase prior to Russia’s invasion of Ukraine in February. Since then, H1 crude prices have been driven by the fallout from the war, reaching record highs. But the oil market will be characterised by major volatility and rising uncertainty as we head into H2.

Japan May trade deficit biggest in eight years; imports surge 48.9%
By Pearl Bantillo 16-Jun-22 18:56 SINGAPORE (ICIS)–Japan posted its biggest trade deficit in eight years at yen (Y) 2.385tr ($18bn), with imports surging by 48.9%, largely due to high energy prices and sharp depreciation of the yen.

US LNG deliveries to the UK in July set to be more profitable than Asian destinations
By Kaja Sillett 16-Jun-22 18:36 LONDON (ICIS)–US LNG deliveries to the UK in July are set to be more profitable than to east Asian destinations, despite the British NBP July’22 contract remaining at a discount to the equivalent ICIS East Asia Index (EAX) price, according to ICIS calculations.

India May exports grow 20.6%; trade deficit widens to $24.3bn
By Priya Jestin 16-Jun-22 17:03 MUMBAI (ICIS)–India’s merchandise exports in May rose by 20.6% year on year to $38.9bn, backed by higher shipments of petroleum products and chemicals, but the country’s trade deficit widened due to high cost of energy imports.

China MEG prices rise on stronger crude market
By Cindy Qiu 16-Jun-22 14:57 SINGAPORE (ICIS)–China’s monoethylene glycol (MEG) prices have been on an uptrend since June, mainly driven by the bullish crude market, as supply-demand fundamentals remain largely unchanged. This has somewhat dampened market players’ confidence in the market outlook.

Asian petrochemicals to rebound in June amid bumpy recovery – ICIS analysts
By Ann Sun 16-Jun-22 12:12 SINGAPORE (ICIS)–Asian petrochemical market is expected to be generally firmer in June given higher crude prices and easing lockdowns in China, according to a latest Price Forecast by ICIS analysts.

Asia BDO weakens on prevailing weak demand, ample supply
By Clive Ong 16-Jun-22 11:32 SINGAPORE (ICIS)–The Asian butanediol (BDO) market remains on a downtrend with regional demand staying lacklustre while ample supply made buyers unhurried. Suppliers concede that buying interest showed limited signs of any revival with further market weakness a possibility.

S Korea truckers’ strike to hit Ulsan petrochemical output; halts port ops
By Nurluqman Suratman 10-Jun-22 18:28 SINGAPORE (ICIS)–The ongoing nationwide strike by unionised truckers in South Korea are forcing several producers in the petrochemical hub of Ulsan to consider production cuts amid logistics disruption.

SE Asia biodiesel market optimism rises on post-lockdown China
By Felicia Loo 10-Jun-22 17:35 SINGAPORE (ICIS)–Market optimism in China to increase imports of southeast Asian palm methyl ester (PME) biodiesel helped bolster market sentiment to some degree amid higher weekly gains in feedstock crude palm oil (CPO) futures.

Asia PET offers reaching level of last historic high on recent upstream price surges
By Hazel Goh 10-Jun-22 12:15 SINGAPORE (ICIS)–Asia polyethylene terephthalate (PET) offers increased in the week and were approaching the level of the last historic high four years ago amid recent Asia upstream price surges.

NE Asia ethylene stays bearish on ample supply, weak demand
By Yeow Pei Lin 10-Jun-22 11:59 SINGAPORE (ICIS)–Northeast Asia’s spot ethylene prices stayed weak due to ample supply amid limited demand for end-June and first-half July arrival cargoes.

India domestic LAB prices rise; China demand improves as lockdowns ease
By Clive Ong 10-Jun-22 11:53 SINGAPORE (ICIS)–India’s domestic prices for linear alkylbenzene (LAB) have spiked on the back of rising costs, but some players expect some headwinds with the monsoon season kicking off.

Oil prices drop more than $1/bbl on partial lockdowns in China
By Nurluqman Suratman 10-Jun-22 11:34 SINGAPORE (ICIS)–Oil prices fell more than $1/bbl on Friday on renewed demand fears after fresh COVID-19 lockdown measures were announced in China, but tight supply concerns capped losses.

S Korea truck drivers go on strike amid rising fuel costs, inflation
By Nurluqman Suratman 08-Jun-22 14:17 SINGAPORE (ICIS)–South Korea’s unionised cargo truck drivers are staging a nationwide, indefinite general strike at ports and container depots across the country in a move which could potentially impact petrochemical-related supply chains and logistics.

East Asia and Pacific growth to slow to 4.4% in 2022 on China deceleration – World Bank
By Nurluqman Suratman 08-Jun-22 11:54 SINGAPORE (ICIS)–Growth in East Asia and the Pacific is projected to slow to 4.4% this year from the 7.2% expansion in 2021, reflecting the marked deceleration in China, the World Bank said late on Tuesday.

Asian PTA prices up on firmer feedstock costs, sustainability uncertain
By Samuel Wong 08-Jun-22 11:51 SINGAPORE (ICIS)–Asian purified terephthalic acid (PTA) prices were supported by costs push because of higher feedstock paraxylene (PX) costs, but long-term sustainability is still a question amid a lack of strong demand growth in the downstream polyester sector.

China May petrochemicals track crude gains; June demand to improve
By Yvonne Shi 08-Jun-22 11:09 SINGAPORE (ICIS)–China’s petrochemical markets largely tracked gains in crude prices in May, accompanied by some improvement in demand as pandemic-related restrictions have started to ease.

Japan’s Q1 GDP revised to smaller contraction of 0.5%
By Nurluqman Suratman 08-Jun-22 11:01 SINGAPORE (ICIS)–Japan’s economy shrank less than initially reported in the first quarter, contracting by an annualised 0.5% instead of the initial 1.0% drop, on the back of improved private consumption, official data showed on Wednesday.

Asia polyester prices gain momentum tracking higher crude, rising cost pressure
By Judith Wang 07-Jun-22 16:27 SINGAPORE (ICIS)–Asia polyester prices gained further momentum as bullish crude futures and rising feedstock prices bolstered spot discussions, while demand has showed some improvement on easing lockdowns in China.

Asia Q3 biodiesel market sentiment to stay weak on poor European demand
By Felicia Loo 07-Jun-22 12:13 SINGAPORE (ICIS)–The third-quarter market sentiment for southeast Asian palm methyl ester (PME) biodiesel is expected to remain weak amid poor buying requirements from Europe, a key importing region for southeast Asian material.

INSIGHT: India cuts raw material import duties to boost local production
By Priya Jestin 07-Jun-22 12:07 MUMBAI (ICIS)–India has cut import duties on some raw materials in the hope of boosting overall domestic production amid surging inflation and rupee weakness.

VIDEO: China PTA plants’ run rates stay low on high production costs
By Winnie Huang 01-Jun-22 18:35 SINGAPORE (ICIS)–Watch industry analyst Lifang Huang discuss China’s purified terephthalic acid (PTA) market amid high production cost.

PODCAST: China LPG prices fluctuate on elevated costs, weak demand
By Candy Nie 01-Jun-22 17:44 SINGAPORE (ICIS)–ICIS analyst Jady Ma and Candy Nie discuss the recent developments and outlook of China’s Liquefied petroleum gas (LPG)  market.

Saudi Aramco’s June LPG contract prices continue downtrend
By Candy Nie 01-Jun-22 15:10 SINGAPORE (ICIS)–Saudi Aramco’s term contract prices (CP) for June-loading liquefied petroleum gas (LPG) continued to edge down and hit a five-month low, the company announced on Tuesday afternoon.

China MTBE cargoes face narrowing arbitrage opportunities into Europe
By Jun Kai Heng 01-Jun-22 14:17 SINGAPORE (ICIS)–The reopening of the Chinese economy in June is expected to pressure arbitrage opportunities into Europe for Chinese methyl tertiary butyl ether (MTBE) cargoes.

S Korea May petrochemical exports rise 14%, total exports up 21.3%
By Nurluqman Suratman 01-Jun-22 12:32 SINGAPORE (ICIS)–South Korea’s petrochemical exports rose by 14% year on year to $5.18bn in May, supporting the overall rise in shipments abroad, official data showed on Wednesday.

Japan’s au Jibun Bank May manufacturing PMI dips to 53.3 on slower output growth
By Nurluqman Suratman 01-Jun-22 11:38 SINGAPORE (ICIS)–au Jibun Bank’s manufacturing purchasing managers’ index (PMI) for Japan slipped to 53.3 in May from 53.5 in April as new orders rose at a slower rate, the Japanese bank said on Wednesday.

Topic Page by Aura Sabadus and Will Beacham. Additional reporting by  Richard Ewing and Sophie Udubasceanu. Maps and graphs by Yashas Mudumbai.


ICIS Premium news service

The subscription platform provides access to our full range of breaking news and analysis

Contact us now to find out more

Speak with ICIS

Now, more than ever, dynamic insights are key to navigating complex, volatile commodity markets. Access to expert insights on the latest industry developments and tracking market changes are vital in making sustainable business decisions.

Want to learn about how we can work together to bring you actionable insight and support your business decisions?

Need Help?

Need Help?