August IPEX the highest for six months

LONDON (ICIS)–The ICIS Petrochemical Index (IPEX) shot up in August by 2.9% in comparison with the revised July figure of 327.43*. Following a strong performances for all three regional sub-indices, August IPEX rose to its highest level since February.

Of all three regions, the US sub-index went up the most in percentage terms, mainly driven by a 17.9% increase in benzene prices. Benzene prices have been pushed up to a record level by a combination of high oil prices, tight supply and very strong downstream demand from the styrene market. Polystyrene (PS) prices in the US were highly impacted by the strong benzene prices and rose by 6.5%, while styrene prices still await settlement. Toluene prices continued their upward trend of recent months and are now at a 17-month high.

The only lower values in the US sub-index were recorded by methanol and butadiene (BD), which exhibited price reductions of 8.1% and 4.6%, respectively. Methanol contract prices dropped because of the much lower spot prices, and BD prices fell on an improved supply and feedstock situation.

The European sub-index was also driven by a benzene price rise of 9.7%. Downstream styrene and PS markets were impacted by this and these prices rose by 5.6% and 0.6%, respectively.

Ethylene prices rose in Europe by 3.8% in dollar terms following cracker outages, which had a direct impact on downstream markets. Polyethylene (PE) prices rose by 2.8% and polyvinyl chloride (PVC) prices by 2.3%.

Of the three regions, European average prices performed the weakest, impacted also by a 4.4% strengthening of the dollar. Euro-based methanol contract prices were the lowest since Q1 2012, mainly because of the lower methanol spot prices of the last few months.

In Asia, apart from a 2.2% reduction in methanol prices, all products of the IPEX product basket went up. Against the downward trend of the other two regions, BD prices in Asia jumped by 8.9%, to their highest since October 2013, following tight supply. Paraxylene (PX) prices exhibited the second strongest growth and went up by 6.3% on a few unplanned plant outages in Asia.

Published at the beginning of each month, the IPEX provides an independent indicator of average change in world petrochemical prices. The IPEX product basket of 12 essential petrochemical products comprises ethylene, propylene, BD, benzene, toluene, PX, styrene, methanol, PVC, PE, polypropylene and PS.

Dating back to January 1993, historical ICIS prices for these products in the US, western Europe and northeast Asian markets have been weighted by regional nameplate capacity to generate the monthly index value.

*The July IPEX has been revised from 325.18 to 327.43 following the settlements of June contract prices for ethylene, PX, styrene and PVC in the US and PX and styrene in Asia. The August index will be subject to further revision once July contract prices settle for ethylene, PX and styrene in the US.

Download global and regional ICIS IPEX data here.

View the full IPEX methodology