Eni see fuel sales in Italy rise after COVID-19 infection rates peak

MOSCOW (MRC) -- Eni is seeing an uptick in fuel demand in Italy from lows during March when the country's lockdown hit pump sales by up to 80%, reported S&P Global with reference to Eni's CEO Claudio Descalzi's statement Friday.

In March, Eni saw its fuel sales reduced on average by 70-80% from normal levels, with gasoline sales hit more sharply than diesel consumption as many delivery trucks were still operating, Descazli told a quarterly earnings call.
"The good news is that is improving, by some percentage points, but it's improving," he said referring to Eni's transport fuel consumption.

"We think, by the end of May, the critical phase is finished and we will start gradually to recover the consumption and go to a possible normal situation by the end of the year."

The Italian government locked down the country - one of the world's hardest-hit by the COVID-19 pandemic -- in early March but is expected to start easing restrictions in the coming weeks after the number of people confirmed as infected recently peaked.

Reporting Q1 earnings Friday, Eni said its retail fuel sales in Italy totaled 1.12 million mt, down by 19% year-on-year, with a notable fall in motorway fuel sales and consumption declining from February.

As MRC informed before, Italy's Eni on Friday lowered its production guidance for 2020 and announced at least a 30% cut in planned capex for 2020 and 2021, in response to the collapse in oil prices and the economic impact of the coronavirus pandemic. The Rome-based major said it expects oil and production to average between 1.75 million–1.80 million b/d of oil equivalent in 2020, down from initial forecasts of around 1.9 million boe/d for the year.
Eni said it will also cut Eur2.3 billion from 2020 capex, 30% lower than the initial targets, and anticipates further reductions of 30%-35% lower than original plans in 2021.

Eni said in early April that most of its oil refineries in Italy were working at around 60% of their capacity as the coronavirus emergency continues. The pandemic has shut down large parts of economies across the globe and prompted many governments to slap tough restrictions on travel, triggering a steep fall in the demand for refined oil products. In emailed comments, Eni said its biggest refinery Sannazzaro, in northern Italy, was running at around 50% of its capacity since it was also impacted by planned maintenance work.

Earlier, in mid-March, the company said all its refineries in

At the same time, operations at Italian petrochemical producer Versalis (part of Eni) have not affected by emergency quarantine measures in the country at that period. Italian Prime Minister Giuseppe Conte extended its emergency coronavirus measures in mid-March and announced the closure of "non-essential" commercial businesses. This follows the earlier announcement of a nationwide lockdown, limiting movement for around 60 million people. Under these measures people werel only allowed to leave their homes for work or health reasons. Versalis has three steam crackers in Italy, capable of producing 1.675 million mt of ethylene, 750,000 of propylene and 285,000 mt of butadiene a year.

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

MOSCOW (MRC) -- Investors already braced for poor first-quarter earnings from major oil and gas companies will focus on how executives plan to save cash and whether they will cut dividends following the collapse in oil prices, said Hydrocarbonprocesiing.

The five biggest U.S. and European firms, known as the Oil Majors, have announced spending cuts averaging 23% in a rapid response to the precipitous fall in oil demand because of the coronavirus pandemic and a 65% slump in crude prices.

With the rout likely to extend for months, the pressure on balance sheets remains extreme as very few parts of oil company businesses make money at the current oil price of USD20 a barrel. “This remains a brutal business environment,” BP (BP.L) Chief Executive Officer Bernard Looney said on Thursday.

From Exxon Mobil (XOM.N) to Royal Dutch Shell (RDSa.L), companies have put projects on hold, slashed production in U.S. shale fields and reduced operations at refineries to deal with the double whammy of a drop in demand and a supply glut.

But more steps are likely to be needed and investors will be watching closely for changes to output forecasts and to see how companies plan to manage dividends, the most important incentive for shareholders worth more than USD40 billion combined last year.

“The look back into what was a weak first quarter seems almost irrelevant. The game plan for dealing with the next three months and the next 18 months is going to be the focus,” said Jefferies analyst Jason Gammel.

BP will be the first Oil Major to report first-quarter results on Tuesday, with Shell on Thursday, Exxon and Chevron (CVX.N) on Friday and France’s Total on May 5.

Italy’s ENI (ENI.MI) reported a 94% slump in net profit on Friday and lowered its spending and production forecasts while Norway’s Equinor will report on May 7.

As MRC informed earlier, Eni on Friday lowered its production guidance for 2020 and announced at least a 30% cut in planned capex for 2020 and 2021, in response to the collapse in oil prices and the economic impact of the coronavirus pandemic. The Rome-based major said it expects oil and production to average between 1.75 million–1.80 million b/d of oil equivalent in 2020, down from initial forecasts of around 1.9 million boe/d for the year.
Eni said it will also cut Eur2.3 billion from 2020 capex, 30% lower than the initial targets, and anticipates further reductions of 30%-35% lower than original plans in 2021.

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

MOSCOW (MRC) -- The European refineries of Russia’s No.2 oil producer Lukoil are now only processing Russian oil, reported Reuters with reference to the Interfax news agency, quoting CEO Vagit Alekperov's statement on Monday.

As MRC informed previously, Stavrolen (part of Lukoil), Russia's major polyolefins producer, resumed its polypropylene (PP) production in Budennovsk after a long scheduled turnaround. The plant's customers said Stavrolen had fully resumed its PP production after the long scheduled maintenance by 15 October 2019. The outage began on 6 September. The start-up of the plant"s high density polyethylene (HDPE) production took place with a week delay.

According to MRC's ScanPlast report, 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.

Lukoil is one of the leading vertically integrated oil company in Russia. The main activities of the company include operations for exploration and production of oil and gas, production and sale of petroleum products. Lukoil is the second largest private oil Company worldwide by proven hydrocarbon reserves. Lukoil's structure includes one of the largest Russian petrochemical plant - Stavrolen.
MRC

MOSCOW (MRC) -- U.S. shale producers, refiners and pipeline companies are scrambling for cash and face likely restructuring as they struggle under heavy debt loads while engulfed in the worst crisis the oil industry has faced, said Reuters.

Fuel demand has tumbled roughly 30% worldwide as the coronavirus pandemic destroys demand for transport, provoking a massive glut of oil that has hammered global prices and left energy companies with no choice but to pump hundreds of millions of barrels into storage.

Just as demand plummeted, Saudi Arabia and Russia started an oil price war, and Riyadh flooded the market with even more crude. That left the oil industry facing the prospect of a long period with prices below their production costs. Shale producers came into the crisis with already high debt levels, namely from big investments to increase production across the United States in a bet on higher prices.

But in turning the United States into the world’s largest oil producer, the companies became the victims of their own success when the quick rise in supply meant returns were thin. Investors lost patience, tightened credit and pushed shale producers to stop expanding and pay them back.

Enter coronavirus. Oil prices have crashed 75% this year, and on Monday, closed at about minus-$38 per barrel. Most U.S. producers have announced one, if not two, rounds of spending and output cuts. But the crash sent prices to levels well below what companies and advisors had modeled in worst-case scenarios, according to energy lawyers.

About half of the top 60 independent U.S. oil producers are in danger of restructuring and will need to find ways to boost their cash pile, according to energy lawyers at Haynes and Boone. “The reverberations from this price collapse will be felt throughout the industry and by everyone who provides services to the industry,” said Buddy Clark, an Houston-based partner at the firm.

Companies that used debt to fund acquisitions before prices crashed, such as oil giant Occidental Petroleum Corp, are focusing on placating shareholders and preserving cash.

Numerous midstream companies backed by private equity are in danger of bankruptcy, according to some of the more than a dozen industry and financial sources Reuters spoke to for this article, while large banks are preparing to become owners of oil and gas fields as they seize energy assets.

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

MOSCOW (MRC) -- Qingdao Haiwan Chemical, has brought on-stream its styrene monomer (SM) plant in Shandong, according to Apic-online.

A Polymerupdate source in China informed that, the company resumed operations at the plant on April 20, 2020. The plant remained under maintenance for about one month.

Located at Qingdao in Shandong province in China, the SM plant has a production capacity of 500,000 mt/year.

According to ICIS-MRC Price report, in Russia, Nizhnekamskneftekhim reduced its April selling PS prices by Rb10,000/tonne. GPPS for injection moulding and extrusion was offered at Rb86,000-90,000/tonne CPT Moscow, including VAT, whereas HIPS - at Rb90,000-94,000/tonne CPT Moscow, including VAT. Penoplex reduced its GPPS prices by Rb10,000/tonne. Demand for the Kirishi plant's material remained quite good. And Gazprom neftekhim Salavat reduced its indicative prices by Rb8,000/tonne, and its GPPS prices for small- and medium-sized buyers have not been settled yet.

Qingdao Haiwan Chemical Co., LTD. was founded in 1947, one member enterprise of Qingdao HIWAN GROUP LTD in Dongjiakou Industrial Park, located in NO.66, Gangfeng Road, Poli Town, Huangdao District, Qingdao city, Shandong Province. The company's main product includes 32% and 50% caustic soda, vinyl chloride (VCM), SG-8, SG-7, SG-5, SG-3 type of polyvinyl chloride (SPVC), dichloroethane (EDC), styrene etc.
MRC