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

April 28/2020

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 million1.80 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.
Author:Margaret Volkova
Tags:PP, PE, LLDPE, crude and gaz condensate, homopolymer PP, propylene, HDPE, ethylene, petrochemistry, Eni, Versalis, Italy, Russia.
Category:General News
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