US spot ethylene margins sink with product prices

Jeremy Pafford

21-Feb-2017

HOUSTON (ICIS)–US spot margins for ethane-based ethylene fell by 15% in the week ended 17 February, as ethylene spot prices plummeted by 11%, the ICIS margin report showed on Tuesday.

Ethane cracker feedstock costs rose by 1.0% during the week, while spot ethylene co-products rose by 2.9%.

US ethylene spot prices fell throughout the week as supply remains ample and demand appears less strong than expected. Although two crackers are still in turnaround, there have been no major unexpected production issues. Also, consumption has been lower than anticipated amid recent outages in downstream markets.

Meanwhile, US contract margins for ethane-based ethylene fell by 0.3% week on week. Contract ethane co-products rose by 1.1%.

The week’s ethylene margins were based upon the January contract and are subject to revision upon the settlement of the February contract.

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