Oil prices fell over 3% on concerns that new coronavirus curbs and slow vaccine rollouts in Europe willl put downward pressure on demand

MOSCOW (MRC) -- Oil prices decreased more than 3%, hit by concerns that new pandemic curbs and slow vaccine rollouts in Europe will hold back a recovery in demand, while a stronger dollar also weighed, according to Hydrocarbonprocessing.

Brent crude futures dropped by USD2.20, or 3.4%, to USD62.42 a barrel by 0948 GMT. US West Texas Intermediate (WTI) crude futures fell by USD2.10, or %3.4, to USD59.46 a barrel.

The market structure was also pointing to weakness, with the front-month Brent spread flipping into a small contango for the first time since January.

Contango is where the front-month contracts are cheaper than future months, and could encourage traders to put oil into storage.

“Continental Europe is tightening the coronavirus measures and thereby further restricting mobility,” Commerzbank said.

“This is likely to have a correspondingly negative impact on oil demand,” they added.

Extended lockdowns are being driven by the threat of a third wave of infections, with a new variant of the coronavirus on the continent.

A stronger US dollar also weighed on prices. As oil in priced in US dollars, a stronger greenback makes oil more expensive for holders of other currencies.

Physical crude markets are indicating that demand is lower, much more so than the futures market.

As MRC informed previously, oil producers face an unprecedented challenge to balance supply and demand as factors including the pace and response to COVID-19 vaccines cloud the outlook, according to an official with International Energy Agency's (IEA) statement.

We remind that the COVID-19 outbreak has led to an unprecedented decline in demand affecting all sections of the Russian economy, which has impacted the demand for petrochemicals in the short-term. However, the pandemic triggered an increase in the demand for polymers in food packaging, and cleaning and hygiene products, according to GlobalData, a leading data and analytics company. With Russian petrochemical companies having the advantage of access to low-cost feedstock, and proximity to demand-rich Asian (primarily China) and European markets for the supply of petrochemical products, these companies appear to be well-positioned to derive full benefits from an improving market environment and global economy post-COVID-19, says GlobalData.

We also remind that in December 2020, Sibur, Gazprom Neft, and Uzbekneftegaz agreed to cooperate on potential investments in Uzbekistan including a major expansion of Uzbekneftegaz’s existing Shurtan Gas Chemical Complex (SGCC) and the proposed construction of a new gas chemicals facility. The signed cooperation agreement for the projects includes “the creation of a gas chemical complex using methanol-to-olefins (MTO) technology, and the expansion of the production capacity of the Shurtan Gas Chemical Complex”.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 241,030 tonnes in January 2021 versus 217,890 tonnes a year earlier. Only shipments of low density polyethylene (LDPE) and high density polyethylene (HDPE) increased. At the same time, PP shipments to the Russian market reached 141,870 tonnes in January 2021 versus 123,520 tonnes a year earlier. Supply of homopolymer PP and PP block copolymers increased.
MRC

MOSCOW (MRC) - Ukraine's real GDP decreased by 4% in 2020, nominal GDP, that is, in actual prices, amounted to UAH 4.194 trillion, Economic Pravda reports, citing data from the State Statistics Service.

GDP per capita is 100.5 thousand hryvnia. Most of all, according to the calculations of the State Statistics Committee, the sphere of temporary accommodation and catering has suffered, which in terms of volume in 2020 decreased by 28.5%. Behind it is the sphere of transport, warehousing, postal and courier activities, which lost 16.4% of the volume.

Some sectors did have the opportunity to increase production. This applies to construction (+ 5.2%), wholesale and retail trade (+ 4.9%) and information and communication (+ 2.3%).

Ukraine's GDP in the fourth quarter of last year amounted to UAH 1,301.5 billion, 0.5% less than in the same period in 2019. Compared to the third quarter of 2020, it increased by 0.8% (seasonally adjusted data).

The Ministry of Economy maintains the forecast for the growth of the Ukrainian economy in 2021 by 4.6% of GDP. According to the calculations of the Ministry of Economy, in January Ukraine's GDP fell by 2.6-2.8%, including due to the January lockdown. The Ministry of Economy predicts that by the end of the first quarter of 2021, the drop in GDP may reach 3%. In 2021, according to the government forecast, GDP will grow by 4.6%. The World Bank expects Ukraine's GDP growth in 2021 at the level of 3%, the October forecasts were half as much - 1.5%.

Earlier it was reported that the international rating agency Fitch Ratings predicts the growth of real gross domestic product (GDP) of Ukraine in 2021 at the level of 4.1%. The economy will almost recover from a 4.2% downturn in 2020. Fitch points out that the second wave of Covid-19 was much more severe than the first, but the death rate is declining and the agency expects economic constraints to remain limited.
MRC

MOSCOW (MRC) -- Viridis Chemical, LLC (Houston, Texas) has signed an agreement with HELM US Corporation (Houston, Texas) to market and distribute USP-grade, biobased ethanol and biobased ethyl acetate produced at Viridis Chemical’s manufacturing plant in Columbus, Nebraska, according to BiofuelsDigest.

HELM will immediately assume the exclusive responsibility for global sales, marketing and logistics management for both of Viridis Chemical’s products.

Viridis Chemical’s Columbus plant is currently undergoing capital improvements that will increase production capacity.

The plant is expected to begin production of high-quality USP-grade bioethanol in mid-2021 and production of biobased Ethyl Acetate at a global scale in the fourth quarter of 2022.

As MRC informed before, in October, 2019, Helm announced that it will increase the volume of propylene it markets from the PCK refinery at Schwedt in Germany by more than 100,000 tonnes from 1 January, 2020. An additional shareholder of PCK Schwedt had awarded Helm with the “exclusive marketing and logistic services from one of the most modern refineries in Europe”.

Propylene is the main feedstock for the production of polypropylene (PP).

According to MRC's ScanPlast report, PP shipments to the Russian market reached 141,870 tonnes in January 2021 versus 123,520 tonnes a year earlier. Supply of homopolymer PP and PP block copolymers increased.

Helm AG is a Hamburg, Germany based family company established in 1900. HELM is one of the world’s largest chemicals marketing companies. The Company secures access to the world’s key markets through its specific regional knowledge and over 100 branches, sales offices and participations in over 30 countries. As a multifunctional marketing organization HELM is active in the chemicals industry (Feedstocks and Derivatives), in the crop protection industry, in active pharmaceutical ingredients, pharmaceuticals and in the fertilizer industry. Helm AG has a total of 1,521 employees.
MRC

MOSCOW (MRC) -- Berry Global, a leading global nonwovens manufacturer, announced its second investment for 2021 in the wipes segment to support the long-term consumer behavior shift towards infection prevention, amplified by the Covid-19 pandemic, said Nonwovens-industry.

The investment, located in Europe, will increase Berry’s production footprint in support of its global customers, with total investments reaching over USD110 million in nonwoven materials for products such as hard surface disinfectant wipes. Prior to the demand surge of 2020, the European impregnated wet wipes segment, for home cleaning and disinfecting, was growing at the rate of 5% in the 2014 to 2019 time frame. Covid-19 has increased heightened focus on sanitation and personal hygiene for infection prevention, suggesting permanent consumer trends away from the chore of cleaning to a health and safety priority.

"We strategically partner with many of the world’s leading brands with wipe materials, ensuring our investments align with demand for today and for the future. The reliability of our capacity and scale are paramount to our customer support and the trusted relationships we desire to maintain," says Curt Begle, president of Berry’s Health, Hygiene, and Specialties Division.

This new asset will add to the company’s existing spunlace platform, further expanding its sustainable wipes portfolio. Recognizing its customers’ ongoing environmental sustainability goals, the new asset will incorporate the production of biodegradable or recycled nonwoven substrates, increasing Berry’s capacity in Europe by more than 300 million square meters. The new line is expected to be commercially available in the September quarter of 2022.

"This multimillion-dollar investment further completes our industry-leading portfolio. Through flexible assets such as this installation in Europe, we can better serve our customers with reliable, sustainable solutions for the wipes market,” says Achim Schalk, EVP and general manager, EMEIA for Berry’s Health, Hygiene, and Specialties Division.

Berry continues to leverage its ability for continued investments in the latest technology to better serve the market. A longtime leader in the nonwovens space, Berry does not sit idle, and instead continues to push forward with its global size and scale to meet the evolving needs of its customers.

As per MRC, Berry Global Group, Evansville, Indiana, announced that Madrid-based Repsol, its longtime supplier, will supply it with circular resins. The Spanish multienergy global company will supply Berry with International Sustainability and Carbon Certification (ISCC) Plus-certified circular polyolefins from its Repsol Reciclex range.

As MRC reported earlier, Repsol shut down its cracker in Tarragona (Spain) for maintenance in the fourth quarter of 2019. The turnaround at this steam cracker, which produces 702,000 mt/year of ethylene and 372,000 mt/year of propylene, was pushed back from Q3 2019. The exact dates of maintenance works were not disclosed.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,220,640 tonnes in 2020, up by 2% year on year. Only shipments of low density polyethylene (LDPE) and high density polyethylene (HDPE) increased. At the same time, polypropylene (PP) shipments to the Russian market reached 1 240,000 tonnes in 2020 (calculated using the formula: production, minus exports, plus imports, excluding producers' inventories as of 1 January, 2020).
MRC

MOSCOW (MRC) -- The Bashkir Soda Company (BSK) has been excluded from the list of a number of organizations against which Ukraine has imposed sanctions, RBK said.

So, the head of state, Volodymyr Zelenskyy, signed a decree on the implementation of the decision of the National Security and Defense Council of the country on sanctions, the document was published on the president's website.

The sanctions against the BSK were imposed in May 2020 for a period of three years. Restrictions were imposed on trade operations, blocking of assets, complete cessation of the transit of resources, flights and transportation to the territory of Ukraine, suspension of the fulfillment of economic and financial obligations, as well as a ban on participation in the privatization and lease of state property.

Earlier it was reported that in March of this year, the shares of Bashkir Soda Company JSC (BSK) were transferred to the state, thereby restoring the control of the Russian Federation over the assets of the largest soda producer. Until January 17, 2013, 61.65% of Soda OJSC belonged to Bashkiria, 34.79% - to Caustic OJSC. Subsequently, Soda was merged with Caustic, with the latter renaming the Bashkir Soda Company.

According to the ScanPlast of MRC, the Bashkir Soda Company (BSK) produced about 21,700 tonnes of suspension PVC in February against 23,500 tonnes a month earlier. In January - February of this year, the total volume of resin production at the Bashkir enterprise reached 45,200 tonnes, which is 1% less than a year earlier.

JSC "Bashkir Soda Company" was formed in May 2013 by merging JSC "Soda" and JSC "Caustic". Today "BSK" is one of the largest chemical complexes in the country. The company ranks first in Russia in the production of soda ash and baking soda, and is also one of the leaders in the production of PVC, caustic soda and cable compounds.
MRC