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MOSCOW (MRC) -- Top oil producers
resume debate on policy after talks stumbled over February supply levels, with
Russia leading calls for higher output and others suggesting holding or even
cutting production due to new coronavirus lockdowns, said Hydrocarbonprocessing.
Talks
are set to restart at 1430 GMT after the OPEC+ group, which combines OPEC and
other producers including Russia, failed to find a compromise on Monday. OPEC+
sources told Reuters that Russia and Kazakhstan backed raising production by 0.5
million barrels per day (bpd) while Iraq, Nigeria and the United Arab Emirates
suggested holding output steady.
An internal OPEC document, seen by
Reuters on Tuesday and dated Jan. 4, suggested a 0.5 million bpd cut in February
as part of several scenarios considered for 2021. The document also said that
the OPEC+ joint ministerial committee highlighted bearish risks and "stressed
that the reimplementation of COVID-19 containment measures across continents,
including full lockdowns, are dampening the oil demand rebound in
2021".
Three OPEC+ sources said chances of a cut were slim as very few
producers supported it and most countries favoured either steady supply or an
increase in February. "Two clear factions have formed - the Saudi-led proposal
for a cautious approach to maintain oil prices and the Russia-led clarion call
for a swifter return of supply to the market," said Louise Dickson from Rystad
Energy.
On Monday, Saudi Energy Minister Prince Abdulaziz bin Salman said
OPEC+ should be cautious, despite a generally optimistic market environment, as
demand for fuel remained fragile and variants of the coronavirus were
unpredictable. New variants of the coronavirus first reported in Britain and
South Africa have since been found in countries across the world.
With
benchmark Brent oil futures holding above $50 per barrel, OPEC+ took the
opportunity to raise output by 0.5 million bpd in January as it looked to
eventually ease cuts that currently stand at 7.2 million bpd.
OPEC+
producers have been curbing output to support prices and reduce oversupply since
January 2017 and cut a record 9.7 million bpd in mid-2020 as COVID-19 hammered
demand for gasoline and aviation fuel.
As MRC informed
earlier, in October 2019, McDermott International announced that it had been
awarded a contract by Saudi Aramco and Total Raffinage Chimie (Total) for their
joint venture (JV) Amiral steam cracker project at Jubail, Saudi Arabia. Amiral
is a JV in which Aramco holds 62.5% and Total the rest. The plant, designed to
produce 1.5 million metric tons/year (MMt/y) of ethylene, will be one of the
world's largest mixed-feed crackers.
Aramco and Total launched their
USD5-billion Amiral JV project in October 2018. The steam cracker will be fed
with a mixture of 50% ethane and refinery off-gases. It will supply ethylene to
a downstream 1 MMt/y polyethylene manufacturing complex and other petrochemical
products. The project aims to fully exploit operational synergies with the
adjacent refinery, owned by Satorp, another JV between Aramco and Total.
Third-party investors, including Daelim and Ineos, will locate plants at the
value park adjacent to Amiral with a combined investment of USD4 billion. A
final investment decision is expected in 2021.
Ethylene and propylene are
feedstocks for producing polyethylene (PE) and polypropylene
(PP).
According to MRC's DataScope report, PE
imports to Russia decreased in January-November 2020 by 17% year on year and
reached 569,900 tonnes. High density polyethylene (HDPE) accounted for the
greatest reduction in imports. At the same time, PP imports into Russia
increased by 21% year on year to about 202,000 tonnes in the first eleven months
of 2020. Propylene homopolymer (homopolymer PP) accounted for the main increase
in imports. |
