US crude stockpiles rise unexpectedly for second week

MOSCOW (MRC) -- US crude oil stockpiles rose unexpectedly for a second straight week, despite the highest refining rates in six months and lower imports and production, reported Reuters with reference to the Energy Information Administration.

Gasoline inventories increased last week in line with forecasts, while distillates posted an unexpected drawdown, the statistical arm of the EIA said.

Crude inventories rose 2.2 million barrels in the week to June 7, compared with analysts’ expectations for a decrease of 481,000 barrels.

At 485.5 million barrels, commercial stocks were at their highest since July 2017 and about 8% above the five-year average for this time of year, the EIA said.

Crude stocks at the Cushing, Oklahoma, delivery hub for US crude futures rose 2.1 million barrels, the EIA said.

"The report was mostly bearish, given the sizeable crude oil inventory build," said John Kilduff, a partner at Again Capital Management in New York.

Crude prices extended their losses after the report. US crude futures was down USD1.40 a barrel at USD51.87, while Brent traded down USD1.40 at USD60.87 a barrel by 10:55 a.m. EDT (1455 GMT).

Net US crude imports fell last week by 140,000 barrels per day and crude production fell 100,000 bpd from its all-time peak to 12.3 million bpd in the week, it said.

On the demand side, refinery crude runs rose 126,000 bpd as refinery utilization rates jumped 1.4 percentage points to 93.2% of total capacity, their highest since January, EIA data showed.

"Imports fell and processing increased, but not enough to prevent the inventory build," said Carsten Fritsch, oil analyst at Commerzbank AG in Frankfurt, Germany.

Gasoline stocks rose by 764,000 barrels, compared with analysts’ expectations in a Reuters poll for a 743,000-barrel gain.

Distillate stockpiles, which include diesel and heating oil, fell by 1 million barrels, versus expectations for a 1.1 million-barrel increase, the EIA data showed.
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Ineos Styrolution manufactured its own solution

MOSCOW (MRC) -- When styrenics giant Ineos Styrolution needed a packaging solution at its Luran S1 facility, a production line in Ludwigshafen, Germany producing about 35,000 tonnes of packaged goods per year, it called in the services of Bischof + Klein, a leading European full-service supplier of flexible plastic and laminate packaging and technical films, said .

The solution turned out to be close to home: the stretch hood film developed by Bischof + Klein is based on Styroflex, an SBC copolymer produced by Ineos Styrolution.

For Ineos, the experience was a new one but it was “very motivating for us to see our own packaging material Styroflex through the eyes of a customer”, said Peter Lakeman, manager engineering Ludwigshafen at Ineos Styrolution.

Styroflex is a styrene-butadiene block copolymer (SBC) with the properties of a thermoplastic elastomer. In film applications, Styroflex provides excellent stretch recovery, transparency and puncture resistance. The grade chosen, PG77, was particularly tailored for packaging applications like stretch hood solutions. It combines maximum transparency with outstanding elongation and extreme toughness. Styroflex PG77 can be stretched up to 200% with enormous recovery capacity: It snaps back to its original shape, clings tightly to the load and holds it securely.

Frank Heermann, manager product development industrial packaging at Bischof + Klein, said the company enjoyed the collaboration with INEOS Styrolution in Ludwigshafen, adding that “it is interesting to see that the company is using its own products”.

As MRC informed earlier, in February 2019, Ineos Styrolution has made its first production move into China with the acquisition of two 200,000-tonne polystyrene facilities from Total S.A. The deal, which includes the Foshan site in the Guangdong Province in South China and the Ningbo site in the Zhejiang Province in Eastern China, was agreed in August 2018 and has now received regulatory approval. It also includes two sales offices in Gunagzhou and Shanghai.
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Iran scrambles to lift petrochemical sales as sanctions hammer oil

MOSCOW (MRC) -- Iran has been racing to step up exports of petrochemicals and tap new markets to compensate for sliding oil sales, Iranian and international industry sources said, but now risks losing that crucial revenue as Washington tightens the screw on sanctions, said Hydrocarbonprocessing.

Tehran has been selling increased volumes of petrochemical products at below market rates, in countries including Brazil, China and India, since the United States reimposed sanctions on Iranian oil exports in November, according to the six sources who include two senior Iranian government officials. Available ship-tracking data also points to a rise in monthly shipments since then.

The scramble to bolster petrochemical sales could be an indication of how successful the U.S. administration of Donald Trump has been in choking off Iran's oil revenues, which have fallen further than under previous sanctions in 2012.

While the November sanctions applied to petrochemicals as well, the four industry sources said there was a degree of ambiguity given the multiple types of products - including urea, ammonia and methanol - which allowed Iran to keep selling.

However on Friday the U.S. Treasury moved to tighten the restrictions by prohibiting companies from doing any business with Iran's largest petrochemical group, Persian Gulf Petrochemical Industries Company, citing its ties to Iran's elite Revolutionary Guards. The measures also apply to 39 subsidiary companies and foreign-based sales agents.

The Treasury said it intended to "vigorously enforce" the new petrochemical sanctions, which could deal another hammer blow to the Iranian economy. It is difficult to put a comprehensive figure on Iran's income from petrochemicals, Iran's second-largest export industry after oil and gas, but officials said in February that non-oil revenues had surpassed the amount earned by oil exports.

This week Iranian media quoted Ahmad Sarami, a member of the Iranian Oil, Gas and Petrochemical Products Exporters' Union, as saying Tehran received USD11 billion from petrochemical exports in the year ending in March.

The petrochemicals push comes as Iran's oil exports fell to around 400,000 barrels per day (bpd) in May, less than half of April's level and down from at least 2.5 million bpd in April last year, according to tanker data and industry sources.

Iran's annual oil revenue has averaged around USD50 billion in recent years. However a senior U.S. official said in March that Tehran had lost USD10 billion in revenue since sanctions were reimposed in November.

In a sign of the shifting industry landscape, Iran's Supreme Leader Ayatollah Ali Khamenei said in Tehran in April that Iran should move towards the sale of oil products such as petrochemicals instead of crude.

Iranian authorities, who do not recognise U.S. sanctions, dismissed the latest restrictions announced on Friday and vowed to press on with petrochemical exports. Sarami of the exporters' union described the American measures as "psychological warfare". A spokesman for Iran's National Petroleum Company confirmed the ramp-up of petrochemical exports since November, but declined to comment on the destinations.
MRC

Shell agrees to sale of Martinez Refinery

MOSCOW (MRC) -- Equilon Enterprises LLC d/b/a Shell Oil Products US (Shell), a subsidiary of Royal Dutch Shell plc announced it has reached an agreement for the sale of Shell’s Martinez Refinery in California to PBF Holding Company LLC, a subsidiary of PBF Energy, Inc., for USD1.0 billion consideration plus the value of hydrocarbon inventory, crude oil supply and product offtake agreements, and other adjustments, as per Hydrocarbonprocessing.

This divestment aligns with Shell’s strategy to reshape refining efforts towards a smaller, smarter refining portfolio focused on further integration with Shell Trading hubs, Chemicals, and Marketing.

"This deal is another step in our transformation to high-grade and optimise our portfolio to drive resilient returns," said Shell’s Downstream Director, John Abbott.

The transaction is subject to closing conditions and regulatory approvals and is expected to close in 2019.

As MRC reported before, in March 2018, Shell EP Middle East Holdings B.V. completed the sale of the entire share capital of Shell Iraq B.V (SIBV), which held its 19.6% stake in the West Qurna 1 oil field, for USD406 million, to a subsidiary of ITOCHU Corporation.

Royal Dutch Shell plc is an Anglo-Dutch multinational oil and gas company headquartered in The Hague, Netherlands and with its registered office in London, United Kingdom. It is the biggest company in the world in terms of revenue and one of the six oil and gas "supermajors". Shell is vertically integrated and is active in every area of the oil and gas industry, including exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading.
MRC

Engel appoints Michael Traxler to head Mould Technology division

MOSCOW (MRC) -- Following the retirement of Udo Stahlschmidt, Michael Traxler has now been appointed head of ENGEL’s Mould Technology division, an in-house department at Engel’s headquarters in Austria that has been involved in the project planning of injection moulds for more than ten years, said Plasticsnewseurope.

The department is also contracted as a consultant, for example, when it comes to particularly demanding new product developments or feasibility studies.

Traxler has more than 30 years of experience in precision tool making and injection moulding. He joined Engel in 2015 and previously headed the Packaging business unit in North America.

Engel is currently working towards a decentralised approach to the development of mould technology know-how.

“The project planning of injection moulds requires a great deal of coordination and very close cooperation between us as a system solution provider and the plastics processors. That's why it's so important to be on site and speak the native language of our customers,” said Christoph Steger, CSO of the Engel Group.

Engel has established a strong worldwide network of system partners, each of whom is also one of the leading providers in their field. Often commissioned as a general contractor for the complete production cell, including the mould, Engel assumes the overall responsibility, even if other companies are involved in the project, acting as the central point of contact for the customer. This serves in many cases to accelerate the project while offering the customer a greater feeling of security.

As MRC informed earlier, in May 2019, Austria-based injection molding machine maker Engel has opened its second location in Mexico.
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