Bundled product to be offered after usual capacity allocated on monthly basis If approved by regulators, this could benefit Ukraine and TSOs along the route Use of Trans-Balkan corridor in line with EU Russian gas phaseout roadmap LONDON (ICIS)–Gas transmission system operators (TSOs) along the Trans-Balkan route are looking to establish a single bundled transmission capacity product that would allow gas imported into Greece to be shipped to Ukraine at a uniform discounted tariff, according to a letter sent by the operators to national regulators and seen by ICIS. TSOs in Greece, Bulgaria, Romania, Moldova and Ukraine are proposing to offer a ‘route product’ which would connect several border points. This means that, rather than paying for capacity separately, companies would be able to book the full route at a single tariff. The route will be used for supplies to Ukraine only and will not allow companies to access domestic virtual trading points along the Trans-Balkan corridor for now. If approved, the product will be offered on a temporary basis between June–September 2025, but could be extended if it proves viable. The proposed Route 1 would involve the following interconnection points: Kulata/Sidirokastron (Greece-Bulgaria) Negru Voda/Kardam (Bulgaria-Romania) Isaccea/Orlovka, Kaushany, Grebenyky (Romania-Ukraine, Ukraine-Moldova, Moldova-Ukraine) LOWEST AVAILABLE CAPACITY Subject to regulators’ approval, the capacity offered at each interconnection point (IP) will be the lowest available firm capacity at any of the IPs along the route and will be matched in the other IPs. This principle will apply on the remaining available capacity after the usual capacity is allocated at rolling monthly auctions in line with EU rules. “This approach will ensure that the offered Route 1 product consists only of capacity which was not booked, [for which] market participants have not expressed their interest in booking it during the standard auctions and would otherwise remain unutilized. This solution will also reinforce the principles of sustainable competition and solidarity,” the grid operators said in the letter seen by ICIS. The proposed Route 1 product is planned to be offered on the Hungary-based Regional Booking Platform (RBP) on a monthly basis, on the 4th Monday of each month immediately preceding the month of delivery. To guarantee the completion of auctions on the same day, operators will apply a uniform price algorithm. DISCOUNTED TARIFF The capacity of Route 1 product will be offered at a reserve price equal to the sum of the reserve prices applicable for monthly capacity at the IPs for the respective month. The total sum of the tariffs charged by the Greek , Bulgaria, Romanian and Moldovan TSOs would be discounted by 25%. The Ukrainian gas grid operator, GTSOU, already applies a 46% short-haul tariff discount at the Isaccea and Kaushany border points with Romania and Moldova, providing the Grebenyky border point with Moldova is also used. More concretely,  it currently costs just over €10/MWh to export regasified gas from Greece’s Revithousa LNG terminal to Ukrainian storage. If the proposed Route 1 uniform tariff is approved, the total tariff from Greece up to the Romanian-Bulgarian border would be discounted by 25%. The remaining stretch from Isaccea to Grebenyky crossing Moldova would be discounted by 46% in line with existing tariff reductions offered by GTSOU. SUPPLY DIVERSIFICATION The EU has identified the Trans-Balkan corridor as one of the key transmission routes of gas to help central and eastern European countries to diversify away from Russian gas. For now, Route 1 would mostly benefit Ukraine as it seeks to secure over 5 billion cubic meters (bcm) of gas to build up stocks ahead of winter. However, operators along the corridor would also generate revenue as some of the capacity had been idle in recent years. Route 1 proposes the shipment of gas from Greece to Ukraine, but there have also been discussions to include delivery points from the Alexandroupolis LNG terminal once it returns from maintenance in August. This means that the Interconnector Greece Bulgaria (IGB) could also be added to the single product. A source close to discussions told ICIS operators are also considering an option for a shorter route linking Bulgaria to Moldova or Bulgaria to Ukraine. Nevertheless, Bulgaria is a transit route for Russian gas which means there is a risk that those volumes would end up in Ukrainian storage just as the EU is preparing to clamp down on spot imports from Russia.

SINGAPORE (ICIS)–Thailand’s GDP grew by 3.1% in the first quarter of 2025, but the southeast Asian country has slashed its GDP forecast amid looming US tariffs and uncertainty over a global trade war, official data showed on 19 May. 2025 GDP growth revised to 1.3-2.3% Trade surplus improves but domestic manufacturing remains weak Response to US tariff threat essential – NESDC Amid declines in spending across major categories, private consumption rose by 2.6%, down from 3.4% in the previous quarter, the National Economic and Social Development Council (NESDC) said in a statement. Exports by southeast Asia’s second-largest economy surged by 15.0% year on year to $80.4 billion in the first quarter, the strongest growth in 13 quarters, fueled by electronics and rubber. Imports rose 7.1% to $72.3 billion in the first quarter of 2025, driven by a rise in consumer goods and raw material imports. Manufacturing activity remained subdued despite a surge in merchandise exports, economists from Singapore-based UOB Global Markets & Research said. The robust export performance helped the trade surplus rise to $8.2 billion from the previous quarter’s $5.4 billion. “Growth was driven mainly by services and agriculture, while manufacturing remained weak,” UOB said. 2025 OUTLOOK In response to high household and corporate debt burdens, along with a global economic and trade slowdown, Thailand has revised its GDP growth forecast downward by 1.0% to within 1.3-2.3%, with a midpoint forecast of 1.8%. “Key supporting factors include the increased public investment expenditure, the continued expansion of private consumption amid low unemployment and inflation rates, and the continued recovery of the tourism sector and related services,” the NESDC said. Thailand still faces 36% “reciprocal” tariffs from the US, although these were suspended for 90 days back in April. Meanwhile, UOB maintains its 2025 GDP growth forecast at 2.0%. Thai authorities said priorities for the remainder of 2025 should include quickening budget disbursement; addressing trade protectionist policies through responsive measures; and safeguarding the manufacturing sector from unfair trade practices. It advised investigating dumping practices and “other unfair trade measures” used by major exporting countries. “Affected entrepreneurs should be supported in accessing procedures for initiating anti-dumping, countervailing duty, and safeguard investigations,” the NESDC said. Thailand will also offer larger tax incentives to small and medium-sized enterprises (SMEs) in a bid to mitigate US tariff threats, according to the Board of Investment on 19 May. Focus article by Jonathan Yee

SINGAPORE (ICIS)–A fire broke out at South Korea-based tire manufacturer Kumho Tire at its Gwangju plant in the south of the country on 17 May, suspending operations at the plant. The fire, which took place at the company’s Plant 2, broke out at 7am local time (22:00 GMT) and firefighters were dispatched, with containment levels at over 90% by 18 May, according to South Korea’s National Fire Agency. Kumho Tires issued an apology on 18 May and said it is working with the fire department “and other relevant authorities” to extinguish the fire. It is also investigating how the blaze started. “We … are responding systematically and responsibly to all procedures, including damage recovery, resident protection, and cooperation with relevant authorities,” Kumho Tire said. “The expected date of production resumption and other changes will be re-announced as details are confirmed,” said Kumho Tire in a bourse statement on 19 May. The Gwangju plant accounts for 19.7% of Kumho Tire’s total global capacity, the company said. Demand losses for raw materials such as synthetic rubbers – an important component for tires – may be contained as the company is expected to raise operating rates at other sites to minimize disruptions as a result of the fire, market sources said. Kumho Tire is considering plans to substitute Gwangju plant production by utilizing its Gokseong plant as well as plants located overseas, sources said. Additional reporting by Ai Teng Lim

SAO PAULO (ICIS)–Here are some of the stories from ICIS Latin America for the fortnight ended on 16 May. NEWS Brazil’s Braskem swings to profit in Q1 but global petchems issues remainBraskem swung to a net profit in the first quarter, year on year, but sales and earnings fell slightly as the global petrochemicals downturn continues, management at the Brazilian polymers major said on Monday. Braskem-Idesa launches its ethane import terminal in MexicoBraskem-Idesa (BI) officially launched the Terminal Quimica Puerto Mexico (TQPM) on Wednesday, according to a notice from the company. Brazil’s Unipar Q1 metrics show start of recovery, but further protectionism needed – execsUnipar’s Q1 sales and earnings rose strongly, year on year, despite the prolonged global petrochemicals downturn, weather-related disruptions at its Argentine operations, and lower self-generated energy availability in Brazil due to grid operator restrictions, executives the Brazilian chemicals producer said on Friday. Brazil’s Unigel small earnings save day in Q1; deal with Petrobras imminent ‘at no cost’ Unigel’s Q1 low earnings at Brazilian reais (R) 23 million ($4.0 million) represented, however, a recovery from negative earnings of R29 million in the same quarter of 2024, the Brazilian styrenics and acrylics producer said on Friday. Brazil’s Unigel still planning exit from fertilizers but may mull Petrobras plans for northern facilitiesUnigel could evaluate plans set out by Petrobras for the fertilizers plants in the northern states of Bahia and Sergipe which were leased to the Brazilian chemicals producer until this month, a spokesperson for Unigel said to ICIS. INSIGHT: Mexico’s automotive tariffs raise specter of recession, rest of LatAm more resilientMexico remains the potential largest victim of the change in US trade policy, but practically no country in the world would be spared from an impact, analysts said this week. INSIGHT: Brazil’s Lula visit to China bears fruit with multi-billion dealsBrazilian President Luiz Inacio Lula da Silva had already got several investment deals in the bag midway through his five-day state visit to China – among others, Envision Group has committed $1.0 billion in Latin America’s largest economy to produce sugarcane-based sustainable aviation fuel (SAF). MOVES: Mexico’s trade group ANIQ appoints Jose Carlos Pons as presidentMexico’s chemicals trade group ANIQ has appointed Jose Carlos Pons as president for the 2025-2027 term amid intensifying pressures from trade disputes with the US and broader regional challenges. Mexico’s chemicals Q1 output down 1.4% amid wider industrial fallsMexico’s chemicals output fell by 1.4% in the first quarter (Q1), year on year, but production of plastics and rubbers rose healthily, the country’s statistical office Inegi said. Argentina’s fall in inflation further boosts Milei’s cause, but sustained success harder to come byArgentina’s annual rate of inflation fell further in April to 47.3%, down from 56% in March, according to the country’s statistical office Indec, in another boost to President Javier Milei drastic economic measures. IFA ’25: Brazil Potash pushes to ‘lock-in funding this year’Muriate of potash (MOP) mine developer Brazil Potash continues its pursuit of investors at the International Fertilizer Association (IFA) annual conference in Monte Carlo. Colombia’s fiscal woes to grow on lower crude prices, hit Petro’s pre-election spending plansPotentially lower crude oil prices in coming months will dent Colombia’s Treasury ability to collect proceeds from the key income-generator sector, which is dominated by state-owned Ecopetrol.  PRICINGLatAm PP domestic, international prices unchanged on sufficient supply, stable to soft demandDomestic and international polypropylene (PP) prices were unchanged this week across Latin American countries. LatAm PE domestic, international prices steady on stable demand, ample supplyDomestic and international polyethylene (PE) prices were assessed as steady this week across the region. LatAm PE domestic prices fall on the back of competitive imports from the USDomestic polyethylene (PE) prices fell across Latin American countries on the back of competitive offers from the US. LatAm PP domestic prices steady to lower on cheaper imports and feedstocksDomestic polypropylene (PP) prices were assessed as steady to lower across Latin American countries on the back of lower feedstock costs and competitive offers from abroad.

HOUSTON (ICIS)–Here are the top stories from ICIS News from the week ended 16 May. China, US agree to lower tariffs by 14 May for 90 days The US and China have agreed to de-escalate trade war with sharp cuts on tariffs by 14 May 2025, for an initial period of three months, according to a joint statement issued on Monday by the world’s two biggest economies. US chem shares surge on tariff pause US-listed shares of chemical companies surged on Monday after the US and China agreed to a 90-day pause on the tariffs they imposed on each other since 2 April. INSIGHT: US-China 90-day pause a huge relief for US chemicals, to catalyze strategic rethinking The US-China agreement to substantially take down tariffs during a 90-day pause while negotiations on a trade deal resume is a big relief for US chemicals and plastics producers, especially those with meaningful exports to China. Canada’s Alberta province freezes industrial carbon price, cites US tariffs The government of Canada’s oil-rich Alberta is freezing the province’s industrial carbon price at Canadian dollar (C$) 95/tonne ($68/tonne). INSIGHT: US propane poised for China return on sharp cuts in bilateral tariffs High-level trade talks between the US and China on 12 May have yielded significant reduction in the level of newly imposed tariffs by both sides, boding well for operating rates at Chinese propane dehydrogenation (PDH) plants. INSIGHT: Brazil’s Lula visit to China bears fruit with multi-billion deals Brazilian President Luiz Inacio Lula da Silva had already got several investment deals in the bag midway through his five-day state visit to China – among others, Envision Group has committed $1.0 billion in Latin America’s largest economy to produce sugarcane-based sustainable aviation fuel (SAF). Saudi Aramco, US companies sign deals worth $90 billion Saudi energy and chemical giant Saudi Aramco has signed 34 Memoranda of Understanding (MoUs) and agreements potentially worth about $90 billion in total, with major US companies. INSIGHT: US auto, metal tariffs persist, threaten chem demand The tariff deal that the US has reached with China did not eliminate the duties on steel, aluminium and auto parts, all of which could lower automobile production and reduce demand for the plastics and chemicals used to make the vehicles. Texas firms expect partial but swift pass through of tariff costs Businesses in the chemical-heavy US state of Texas expect a partial but swift pass through of the costs they expect to bear from the nation’s tariffs, the Federal Reserve Bank of Dallas said on Friday.

SINGAPORE (ICIS)–Singapore’s petrochemical exports in April rose 1.4% year on year to Singapore dollar (S$) 1.13 billion ($868.6 million), amid continued overall frontloading activities by exporters, official data showed on 16 May. Petrochemical exports rise 1.4% April NODX rises 12.4% year on year 2025 NODX outlook raised to 2.0-4.0% – UOB April non-oil domestic exports (NODX) grew by 12.4% year on year, up from the 5.4% growth in the previous month, Enterprise Singapore (EnterpriseSG) said in a statement. Meanwhile, NODX grew by 5.6% in the first four months of 2025. Non-electronic NODX, which includes pharmaceuticals and chemicals, rose by 9.3% year on year in April. NODX to eight of Singapore’s top 10 export countries expanded in April 2025, but NODX to China, and Malaysia contracted, EnterpriseSG said. OUTLOOK While a de-escalation of a trade war between the US and China that began on 14 May came as a surprise, risk may now be “asymmetrically skewed” towards higher tariffs following the 90-day expiry on reciprocal tariffs on the rest of Asia, said economists at Singapore-based UOB Global Economics & Markets Research. Economists revised up Singapore’s full-year 2025 NODX forecast to the range of +2.0-4.0%, from -4.0% previously, noting that the situation remains fluid. “There are likely to be some payback effects from front-loading,” UOB added, noting it could result in an even more protracted downturn in trade activity, possibly in 2026. Focus article by Jonathan Yee

LONDON (ICIS)–Click here to see the latest blog post on Chemicals & The Economy by Paul Hodges, which looks at what’s happening to US interest rates as the bond vigilantes return. Editor’s note: This blog post is an opinion piece. The views expressed are those of the author and do not necessarily represent those of ICIS. Paul Hodges is the chairman of consultants New Normal Consulting.

LONDON (ICIS)–Here are some of the top stories from ICIS Europe for the week ended 16 May. INSIGHT: Markets rally as US, China de-escalate tariffs stand-offMarkets and chemicals stocks rallied on Monday in the wake of an agreement by the US and China to dramatically cut reciprocal tariff rates for 90 days, signalling the first step in a de-escalation of trade tensions. INSIGHT: Limited improvements in demand for toluene and downstream sectors in EuropeNo significant growth is expected for toluene consumption in the near future, with long markets for certain isocyanates, a disappointing start to the summer driving season and tepid benzene demand stymying near-term growth hopes. INSIGHT: Sale of SABIC assets in Europe could make strategic senseA sale by SABIC of its European petrochemical assets could make strategic sense as the company has production in the Middle East, US and China, which benefit from much lower production costs. Europe butac sellers voice concerns over cheaper Chinese imports amid weak demandButyl acetate (butac) sellers in Europe have grown increasingly concerned about competitively-priced imports from China. As spot buying appetite in the continent is already subdued, domestic sellers are facing intense competition to offload material. European OX market flatlines as construction demand struggles, tariff uncertainty continuesHopes for a pick-up in European orthoxylene (OX) demand for the rest of 2025 are fading among downstream phthalic anhydride (PA) producers, as orders from the key construction sector remain flat year on year in the early stages of the warm season.

SINGAPORE (ICIS)–Taiwan’s ethylene crackers are expected to run at 60-70% of capacity on average this year amid heightened regional competition and weak downstream demand, according to the Petrochemical Industry Association of Taiwan (PIAT). Economic uncertainty, US tariffs and geopolitical risk are pressure points for the industry, the industry body said in a report released at the Asia Petrochemical Industry Conference (APIC) 2025 on 15-16 May in Bangkok. Taiwan’s ethylene capacity is about 4.0 million tonnes; while its propylene capacity is about 3.4 million tonnes, according to PIAT. Despite a potential short-term rebound in prices for Taiwan’s petrochemical sector in 2025, continued capacity extensions in China will “intensify market price competition”, PIAT said. For 2025, it forecasts a 2.7% growth for both supply and demand of ethylene, with a projected 61% surge in exports. Propylene, on the other hand, is expected to post a 2.2% contraction in both supply and demand, with exports expected to more than double. Ethylene (in tonnes) 2024 2025 (estimated) change Supply Production 2,596,243 2,650,000 2.1% Import 228,176 250,000 9.6% Total 2,824,419 2,900,000 2.7% Demand Domestic 2,818,820 2,891,000 2.6% Export 5,599 9,000 60.8% Total 2,824,419 2,900,000 2.7% Year End Capacity (tonnes/year) 4,005,000 4,005,000  Propylene (in tonnes) 2024 2025 (estimated) change Supply Production 2,315,130 2,363,700 2.1% Import 309,100 202,600 -34.5% Total 2,624,230 2,566,300 -2.2% Demand Domestic 2,566,418 2,400,500 -6.5% Export 57,812 165,800 186.8% Total 2,624,230 2,566,300 -2.2% Year End Capacity (tonnes/year) 3,370,500 3,370,500 Source: PIAT China is expected to increase its 2025 ethylene capacity by approximately 7.8 million tonnes, or by 15%, to 60.99 million tonnes. But ethylene derivative consumption is expected to grow at a slower rate of 12.6%, and ethylene demand is expected to rise by just 6%, PIAT said, posing a challenge for neighboring suppliers that have historically relied on exports to China. Taiwanese producers have either reduced operating rates or remained idle over the past three years, while ethylene exports to China dropped to zero last year. “Given weak downstream demand and regional competition, cracker utilization rates are expected to average 60%-70% in 2025,” PIAT said in the report. Meanwhile, Taiwan’s demand for propylene is expected to weaken further due to weak downstream demand, particularly for polypropylene (PP) and epichlorohydrin (ECH). China’s ongoing capacity expansion also continues to pressure Taiwanese producers, said the PIAT. Since 2024, Taiwan’s propylene exports to China have been subject to tariffs, posing a challenge for accessing the Chinese market. According to PIAT data, major petrochemical production dropped 2.39%, exports were down by 4.3% and demand fell by 1.1% in 2024 from the previous year. Visit the ICIS Topic Page: US tariffs, policy – impact on chemicals and energy. Thumbnail image At the port city of Keelung, Taiwan on 20 March 2025. (RITCHIE B TONGO/EPA-EFE/Shutterstock)