Crude oil futures edge lower on EIA data, pandemic concerns

MOSCOW (MRC) -- Crude oil futures ticked lower during morning trade in Asia Nov. 19, after data from the Energy Information Administration showed a small build in US commercial crude inventories, and as concerns over the uninhibited progression of the coronavirus pandemic festered in the market, reported S&P Global.

At 10:26 am Singapore time (0226 GMT), ICE Brent January crude futures were down 9 cents/b (0.20%) from the Nov. 18 settle at USD44.25/b, while the NYMEX December light sweet crude contract was down 18 cents/b (0.43%) at USD41.64/b.

Both ICE Brent January contract and December WTI contract rose on Nov. 18 after Pfizer and BioNtech said that a final analysis of clinical-trial data showed that their vaccine was 95% effective, and that they would submit an application for US regulatory authorization in the coming days.

However, the uptrend in oil prices was stymied by Nov. 18 data from the EIA, which showed that, in the week ended Nov. 13, US commercial crude inventories rose 770,000 barrels to 489.48 million barrels and were now 6.4% above the five-year average.

EIA data was more bullish than the Nov. 17 data from the American Petroleum Institute, which had shown a 4.174 million-barrel build in crude inventories in the same week, while analysts surveyed by S&P Global Platts had expected crude stocks to rise by only 100,000 barrels.

EIA data was also indicative of unimproved fundamentals in downstream markets as it showed that US gasoline inventories rose 2.61 million barrels to 227.97 million barrels in the week ended Nov. 13, with weekly product supplied for gasoline, EIA's proxy for demand, sliding 500,000 b/d to 8.26 million b/d, the lowest since the week ended Jun. 12.

The one positive from the report was a 5.22 million-barrel draw in distillate inventories to 144.07 million barrels, with distillate demand climbing 170,000 b/d to 4.23 million b/d.

At 10:26 am Singapore time, the NYMEX December RBOB contract was trading 0.52 cent/gal (0.45%) lower than the Nov. 18 settle at USD1.1577/gal and the NYMEX December ULSD contract was up by 0.17 cent/gal (0.13%) at USD1.2657/gal.

Meanwhile, concerns over the coronavirus pandemic were exacerbated by media reports that New York City's public schools will close temporarily to stem the rise in COVID-19 infections, after the city recorded a seven-day average positive rate of 3%.

Market analysts lamented the unabated rise in infection numbers in major US cities could culminate in increased restrictions during the holiday season.

ANZ analysts said in a Nov. 19 note: "[A vaccine] approval can't come quickly enough for the oil market, with the outlook for demand darkening amid ever increasing restrictions. A survey by GasBuddy says that only 35% of Americans will be taking to the roads during the Thanksgiving holiday. This is down from 65% last year."

As MRC informed previously, global oil demand may have already peaked, according to BP's latest long-term energy outlook, as the COVID-19 pandemic kicks the world economy onto a weaker growth trajectory and accelerates the shift to cleaner fuels.

Earlier this year, BP said the deadly coronavirus outbreak could cut global oil demand growth by 40 per cent in 2020, putting pressure on Opec producers and Russia to curb supplies to keep prices in check.

And in September 2019, six world's major petrochemical companies in Flanders, Belgium, North Rhine-Westphalia, Germany, and the Netherlands (Trilateral Region) announced the creation of a consortium to jointly investigate how naphtha or gas steam crackers could be operated using renewable electricity instead of fossil fuels. The Cracker of the Future consortium, which includes BASF, Borealis, BP, LyondellBasell, SABIC and Total, aims to produce base chemicals while also significantly reducing carbon emissions. The companies agreed to invest in R&D and knowledge sharing as they assess the possibility of transitioning their base chemical production to renewable electricity.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,594,510 tonnes in the first nine months of 2020, up by 1% year on year. Only high denstiy polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market reached 880,130 tonnes in the nine months of 2020 (calculated using the formula: production minus exports plus imports, excluding producers' inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.
MRC

MOSCOW (MRC) -- Nexus Fuels LLC (Nexus) and Shell announce a supply agreement, for 60,000 tons over four years, of pyrolysis liquid made from plastic waste, which is then converted into chemical products, according to Hydrocarbonprocessing.

Nexus, a leader in plastic waste molecular recycling, will supply fully circular, ISCC Plus-certified product from its plant in Atlanta.

This enhanced collaboration follows a year of continuous, high-quality supply to Shell’s chemical plant in Norco, Louisiana, USA, where it has been used in the liquid cracker to make chemicals that are the raw materials for everyday items. The new agreement builds on that success and on a common desire to find solutions to plastic waste pollution and progressing a low-carbon future. It is a next step towards Shell’s ambition to use one million tons of plastic waste a year in its global chemical plants by 2025.

Jeff Gold, Nexus chief executive officer, said “We appreciate Shell’s support of Nexus to convert waste plastics to virgin-molecule feedstocks and back into chemical products. Their teams have been great partners and share our philosophy and vision for improving our environment.”

Thomas Casparie, executive vice president of Shell’s global chemicals business, said “Real-world, in-plant testing and application is key to proving technologies and scaling up production of chemicals from plastic waste. This new supply agreement with Nexus is built on that solid foundation and is a positive step towards providing our customers with bigger volumes of sustainable, circular chemicals.”

As MRC informed before, Royal Dutch Shell plc. said earlier this month that its petrochemical complex of several billion dollars in Western Pennsylvania is about 70% complete and in the process to enter service in the early 2020s. The plant's costs are estimated to be USD6-USD10 billion, where ethane will be transformed into plastic feedstock. The facility is equipped to produce 1.5 million metric tons per year (mmty) of ethylene and 1.6 mmty of polyethylene (PE), two important constituents of plastics.

Ethylene and propylene are feedstocks for producing PE and polypropylene (PP).

According to MRC"s ScanPlast report, Russia's estimated PE consumption totalled 1,594,510 tonnes in the first nine months of 2020, up by 1% year on year. Only high denstiy polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market reached 880,130 tonnes in the nine months of 2020 (calculated using the formula: production minus exports plus imports, exluding producers" inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.

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

MOSCOW (MRC) -- Led by the wood, chemical, and food industries, Canadian manufacturing sales rose 1.5 per cent to USD53.8 billion in September, according to new figures from Statistics Canada, said Canplastics.

The increase followed a revised drop of 1.4 per cent in August compared with the 2.0 per cent decrease that was initially reported.

The result for September matched the average expectations of economists surveyed by financial data firm Refinitiv. Sales rose in 13 of the 21 manufacturing sectors as the wood industry climbed 9.6 per cent in September to a record $3.3 billion due to higher sales at sawmills and wood preservation manufacturers.

The chemical industry rose 6.7 per cent to USD4.5 billion, while the food industry increased 1.3 per cent to USD9.2 billion for the month.

StatCan also said that manufacturing sales in constant dollars rose 2.1 per cent, indicating a larger volume of products was sold in September.

We remind that Russia's output of chemical products rose in September 2020 by 6.7% year on year. At the same time, production of basic chemicals increased by 6.1% year on year in the first nine months of 2020, according to Rosstat's data. According to the Federal State Statistics Service of the Russian Federation, polymers in primary form accounted for the greatest increase in the January-September output. Last month's production of primary polymers decreased to 852,000 tonnes from 888,000 tonnes in August due to shutdowns in Tomsk, Ufa and Kazan. Overall output of polymers in primary form totalled 7,480,000 tonnes over the stated period, up by 16.4% year on year.
MRC

MOSCOW (MRC) -- Swedish polymer product and component maker Nolato Group has completed its acquisition of U.S. medical technology company GW Plastics, as per Canplastics.

First announced in August 2020, the deal sees GW Plastics’ seven global manufacturing facilities joining Nolato’s 25-plus facilities around the world. Bethel, Vermont-based GW Plastics has also subsequently rebranded to Nolato GW Inc.

Just over four-fifths of GW Plastics’ business will be reported under the Medical Solutions business area, with the remainder reported under Industrial Solutions. The transaction is expected to have a marginal positive effect on Nolato’s earnings per share for the current year.

The acquisition means Nolato has a solid global position on the three key continents of Asia, Europe, and North America. Headquartered in Torekov, Sweden, Nolato is a global solutions provider specializing in developing and manufacturing products in polymer materials such as plastic, silicone, and TPE for leading companies within the healthcare, automotive, and consumer electronics industries.

"We believe Nolato aligns exceptionally well with GW Plastics’ business and culture, and together we’ll offer our customers the same predictability and engagement they have come to rely on,” said GW Plastics president and CEO Brenan Riehl. “Our customers will now be able to enjoy the support and scale of the entire Nolato Group with its comprehensive product development, engineering services, and extensive global manufacturing network. The combined capabilities and synergies between our companies are second to none and we look forward to leveraging them for our customers’ benefit."

As MRC informed earlier, at an investment cost of about SEK 30m (EUR 3.3m), the Medical division of Nolato is to expand its production site in Mosonmagyarovar/Hungary. The Swedish group plans to build a new hall with a production area of 3,500 m2. Subsidiary Nolato Magyarorszagdie will be able to use the new space, which includes additional clean room capacity, from 2013 onwards. According to local media reports, the expansion will result in raising current employee levels from 400 to around 450.

We remind that Russia's output of chemical products rose in September 2020 by 6.7% year on year. At the same time, production of basic chemicals increased by 6.1% year on year in the first nine months of 2020, according to Rosstat's data. According to the Federal State Statistics Service of the Russian Federation, polymers in primary form accounted for the greatest increase in the January-September output. Last month's production of primary polymers decreased to 852,000 tonnes from 888,000 tonnes in August due to shutdowns in Tomsk, Ufa and Kazan. Overall output of polymers in primary form totalled 7,480,000 tonnes over the stated period, up by 16.4% year on year.
MRC

MOSCOW (MRC) -- Vantage Specialty Chemicals (Chicago, Illinois) says it completed in October an expansion of capacity for n-methyltaurine at Leuna, Germany, to support growing demand for sulfate-free and mild surfactants. N-methyltaurine is an intermediate for the synthesis of taurate surfactants, reported Chemweek with reference to the company's statement.

Ramping up production is a first step toward making the Leuna site the company’s expertise center for sulfate-free solutions, says Alexander Snell, senior vice president/EMEA at Vantage. The company is creating a platform that will support customers looking for sulfate-free surfactant systems, “by leveraging our existing infrastructure and integration within the Leuna industrial complex and improving its potential,” says Snell.

Vantage acquired the Leuna complex through the acquisition of specialty surfactants maker Leuna Tenside in 2018.

As MRC informed before, in December 2019, the Total's refinery in Leuna awarded Bilfinger two further major contracts worth roughly EUR30 million: the first involves exchanging the reactor systems; the second, performing the turnaround for the plant’s POX methanol facility. Total’s refinery Mitteldeutschland in Leuna is one of the most modern industrial plants in Europe.

We remind that Total is evaluating new gas cracker project in South Korea as part of petchems growth strategy.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

ccording to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,594,510 tonnes in the first nine months of 2020, up by 1% year on year. Only high denstiy polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market reached 880,130 tonnes in the nine months of 2020 (calculated using the formula: production minus exports plus imports, exluding producers' inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.
MRC