MOSCOW (MRC) -- U.S. petroleum consumption has fallen by a third since the economy went into lockdown in March but showed signs of stabilizing last week, according to the latest weekly figures from the U.S. Energy Information Administration, said Hydrocarbonprocessing.
Lockdown has caused the biggest economic interruption since the depression of the 1930s and the largest interruption in oil consumption since the birth of the modern petroleum industry in the 1860s.
The challenge now is for domestic oil producers, importers and refiners to adjust to a prolonged period of lower consumption and bring the increase in inventories under control before storage space runs out.
The total volume of petroleum products supplied to the domestic market averaged 14.1 million barrels per day (bpd) in the week ending on April 17 (“Weekly petroleum status report”, EIA, April 22).
The total volume was essentially the same as a week earlier (13.8 million bpd) but down by around a third compared with five weeks ago before the lockdown began (21.5 million bpd).
In response to lower demand, U.S. refiners cut crude processing to 12.5 million bpd last week, down from 15.8 million bpd five weeks ago and 16.5 million bpd at the same point a year ago.
U.S. crude imports slowed to just 4.9 million bpd last week from 6.5 million bpd five weeks earlier, one of the fastest declines in the last decade, and were running at the slowest rate since 1992.
But the refining system is still struggling to digest the enormous volume of unprocessed crude that has accumulated since the economy went into freefall and to limit the build up of unsold fuels.
As mRC informed earlier, Plastics companies operating in the Klaipeda Free Economic Zone (FEZ) have been fortunate. The impact of the COVID-19 outbreak has so far been limited. In fact, they report increasing demand, the opening up of new product and sales segments, and a renewed sense of worth in the eyes of society. The flip side, to date, has been the impact on turnover of falling raw materials and oil prices. Klaipeda. FEZ is the largest plastics hub in the Baltics. It is home to 5 companies active in the plastics industry, who together generated a total turnover of €890m in 2018, or nearly half of Lithuania's total for this industry.
Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 383,760 tonnes in the first two month of 2020, up by 14% year on year. High density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments increased due to the increased capacity utilisation at ZapSibNeftekhim. At the same time, PP shipments to the Russian market were 192,760 tonnes in January-February 2020, down by 6% year on year. Homopolymer PP accounted for the main decrease in imports.
MRC